Virgin Galactic stock trading debuted on the NYSE under the ticker SPCE
Virgin Galactic shares rose sharply on Monday when Sir Richard Branson's space tourism company began trading publicly.
The company listed directly on the NYSE, following the close of the merger last week with Chamath Palihapitiya & # 39; s venture Social Capital Hedosophia.
"Virgin Galactic is making history again today, as it becomes the world's first and only publicly traded commercial human spacecraft company," says CEO George Whitesides in a statement. "For the first time, some will have the opportunity to invest in a human space company that transforms the market. "
Sir Richard Branson stands on the New York Stock Exchange (NYSE) floor in front of Virgin Galactic (SPCE) trading in New York, USA, October 28, 2019.
Richard Branson Virgin Galactic IPO NYSE [19659006] Shares of Virgin Galactic rose more than 9% The shares were previously listed under the ticker IPOA for Palihapitiya's special purpose vehicles, which took a 49% stake in Virgin Galactic. Shares in Palihapitiya's business closed at $ 11.79 per share on Friday, a an increase of almost 12% over the past three months.
Essentially, Monday's debut represented a name change for the company, as investors could trade shares of Paliha pitiya's commitment since before the merger was announced.
Sir Richard Branson is outside the New York Stock Exchange (NYSE) ahead of the listing of Virgin Galactic (SPCE) in New York, USA, October 28, 2019.
Brendan McDermid | Reuters
Special vehicles, also known as SPAC, raise capital to buy an existing company. In Social Capital Hedosophia's case, Palihapitiya's SPAC bought just under half of the company to help it enter the public market. Palihapitiya is the founder of Social Capital and had been an early leader on Facebook.
Branson has stated that he plans to retain his 51% controlling stake after his debut.
Palihapitiya sees Virgin Galactic as "a software-like business," and told CNBC in July that he believes there is a "truly compelling risk reward" behind space tourism. In a March report, UBS estimated that space tourism has a potential $ 3 billion market for the decade from now, even though it "is still in an early phase."
Flying tourists begin next year
With a $ 250,000 price tag per person, Virgin Galactic plans to carry as many as six passengers in the spacecraft at a time. Flying by two pilots, the spaceship is dropped from a jet-powered aircraft and fires a rocket engine, reaching over three times the speed of sound as it climbs around the Earth's atmosphere. Then the spacecraft and passengers float there weightlessly for a few minutes, before gliding back down to land on earth much like a traditional aircraft.
Virgin Galactics spacecraft crashes from under its aircraft before flying into space in February 2019. [19659002] Virgin Galactic | gif by @ thesheetztweetz / CNBC
After years of delays, Virgin Galactic is testing its spacecraft. The company has a list of 603 customers who have paid deposits, some of which have been waiting for a decade for the chance to fly.
"Because it has taken so long to get so far I try not to think about the fact that We are almost there because I have been thinking about it for a few years," Branson told CNBC earlier this month.
The company plans to begin commercial flights by 2020.
Expanding Space Tourism Internationally
Virgin Galactic has testing facilities in California's Mojave Desert and an agreement with Spaceport America in New Mexico for the first commercial flights. But Branson says that's just the beginning of the space tourism business, as the company talks about expanding across multiple continents.
"Abu Dhabi wants us to do a space gate there, and we are in discussions with them," Branson said. "Italy wants us to do a space flight there. The UK wants us to do a space flight. Australia talked to us about doing a space gate."
Virgin Galactic is also looking to start operations "in a few other Asian countries," Whitesides said. But perhaps the most fascinating opportunity may be in Scandinavia, where the company talks with Sweden about flying into the region's spectacular night sky.
"We've been talking about going up in the northern lights," Branson said. "That would be ridiculous."
When it comes to the company's first commercial flights, Branson expects to be on the first one – but it leaves a mystery as to who else will fly with him.
"We have an announcement to make, so I'm not allowed to talk about it," Branson said. "Sometime next year I'll pick up some, but I need to let you know."
