Why is Richard Branson selling off his shares in Virgin Galactic?
Virgin Galactic (SPCE) founder Richard Branson has sold 15.6 million shares worth $300 million, about 6% of the entire company. According to Bloomberg, Branson’s ownership of the aerospace company’s securities has decreased to 11.9%.
At the same time, its value at about $ 600 million, and the billionaire remains the company’s largest shareholder. Nevertheless, since the beginning of the pandemic, Branson has sold Virgin Galactic shares for more than $ 1 billion: in March and August of this year for $150 million and $300 million, the first half of 2020 for another $ 300 million.
According to a Virgin Group representative, the proceeds from the sale should go to support Branson’s tourism and entertainment business. In addition, part of the amount received will be to develop new and existing enterprises. Today, the Virgin brand, created by Richard Branson in 1970 as a retailer engaged in delivering music discs at first, is associated with more than 40 companies worldwide – from record labels to the British bank Virgin Money UK.
In March of this year, Virgin Galactic Chairman Chamat Palihapitiya sold a personal stake of 6.2 million shares worth about $213 million. At the same time, beginning of 2021, SPCE quotes have fallen by almost 21%, including delays in the launch of commercial flights.
However, since Virgin Galactic began trading on the stock exchange after the merger in 2019 with the specialized company (SPAC) Social Capital Hedosophia Holdings, founded by Palihapitiya, the shares have grown by more than 81%. In addition, from 2023, Virgin Galactic plans to make three flights a month with space tourists on board. At the moment, its securities are trading around $18.
