Virgin Orbit will pause all operations – with almost all staff at the satellite launch company expected to be furloughed.
The company made the announcement after the first satellite mission from UK soil failed to reach orbit earlier this year.
Chief executive Dan Hart told staff in a meeting on Wednesday that the furlough was intended to buy Virgin Orbit time to finalise a new investment plan, according to a source present.
The length of the furlough period is currently unclear. However, Mr Hart said he would update employees by the middle of next week.
Virgin Orbit’s shares plunged almost 19% to 82 cents (72p) in extended trading after the announcement.
The company had been valued at $3.2bn in a “blank cheque deal” to take the satellite launch company public on the US stock market in 2021.
But the launch failure on 9 January represented a major blow to the business.
Mr Hart said the company would “proceed cautiously towards the launch” of its next rocket after the first mission failed due to a rocket fuel error.
An investigation was launched into the mission failure from the Spaceport Cornwall site at Newquay Airport.
Richard Branson’s company said in a statement: “On the ops side, our investigation is nearly complete and our next production rocket with the needed modification incorporated is in final stages of integration and test.”
A person wearing an alien costume poses for a photo during a spectator event for the launch
‘Premature shutdown’
What was a highly-anticipated launch led to disappointment after the rocket failed to deploy its payload of nine satellites.
The opening part of the mission went according to plan, with a converted Boeing 747 named Cosmic Girl flying 35,000ft over the Atlantic Ocean off Ireland’s southern coast.
From there, it deployed the 21-metre rocket, named LauncherOne, containing the small satellites – which would have been the first launched into orbit from western Europe.
But organisers identified an “anomaly” leading to a “premature shutdown”.
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The craft “successfully executed pre-flight preparations, carrier aircraft take-off, captive carry flight and rocket release” – all “first-of-a-kind achievements” for an orbital launch attempt from western Europe.
However, the rocket failed in the latter stages and fell back to Earth, landing in an “approved safety corridor” in the Atlantic Ocean.
Mr Hart described the mission failure as “painful for all involved”.
Sky News has contacted Virgin Orbit for further comment.
