Virgin Orbit is preparing for a special purpose acquisition company (SPAC) merger with NextGen Acquisition II (NASDAQ:NGCA) that will take it public without an initial public offering (IPO).
Here’s what traders need to know about the Virgin Orbit SPAC merger deal and what it means for NGCA stock.
- Virgin Orbit is the creator of the world’s first air-launched, liquid-fueled launch system.
- This allows it to send satellites into space for customers.
- This has seen it work with both national and global customers, as well as NASA.
- It launches its satellites via a rocket strapped to a custom Boeing (NYSE:BA) 747.
- This allows it to make use of the height and speed of the plane to launch the rocket more economically.
- It also reduces local carbon emissions when compared to a ground launch.
- When the deal with NextGen Acquisition II closes, it will leave the combined company with $483 million in cash proceeds.
- That includes $383 million of cash held in trust by NextGen Acquisition II.
- Another $100 million comes from a $100 million fully committed PIPE.
- When the SPAC merger closes, Virgin Orbit will maintain its current name.
- However, NGCA stock will no longer be listed under its current ticker.
- Instead, it will switch over to the VORB stock ticker but will remain on the Nasdaq Exchange.
- It’s also worth pointing out that the SPAC deal values the combined company at $3.2 billion.
- Investors can expect the deal to close during the fourth quarter of 2021.
- NGCA is seeing higher-than-normal trading today with some 6 million shares on the move.
- That’s quite the jump compared to its daily average trading volume of 605,000 shares.
NGCA stock was up 1.9% as of Monday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.