Richard Branson, the founder of Virgin Galactic, sold more than 10 million shares in the company in August 2021, before the price of shares tumbled down shortly after.
According to Virgin Galactic’s United States (US) Securities and Exchange Commission (SEC) filings, Branson sold more than 10.4 million shares at an average price of $29.2 between August 10 and August 12, 2021, reducing his shareholding from 55.2 million to 46.3 million following the sales, taking home more than $304.2 million from these transactions alone.
The insider trading transactions were first reported by the Wall Street Journal (WSJ), adding that in total, Branson sold nearly 75% of his shares in Virgin Galactic for a total of $1.4 billion. According to the WSJ report, the funds were used in other Virgin Group companies, including Virgin Atlantic.
The shares were sold by Virgin Investments, a company owned by Virgin Group Investments, the only managing member of which is Corvina Holdings, in turn, owned by Virgin Group Holdings, with Branson being the sole shareholder of the latter.
In October 2019, Virgin Galactic went public through a merger with a special-purpose acquisition company – a ‘shell’ business listed publicly on the stock exchange – at a share price of $11.7, under the ticker SPCE. On February 11, 2021, the stock soared to an all-time high of $60.6, closing at $59.1 on that day. Before Branson sold off his shares, Virgin Galactic’s share price was at a high of $35.5, closing the day at $35.2 on August 9, 2021.
However, on August 13, 2021, SPCE closed at $25.3, tumbling down since and closing at $3.7 on June 1, 2023. The price began to drop in H2 2021, following news of delays and other problems at the company, with the United States (US) Federal Aviation Administration (FAA) eventually grounding Virgin Galactic’s SpaceShip Two temporarily as of September 2021. Then, the FAA investigated the flight of the aircraft when Branson himself went into space in July 2021, citing a “mishap”.
The FAA concluded its probe and has allowed Virgin Galactic to continue missions from late September 2023.
At the end of 2022, Virgin Investments owned 10.9% of Virgin Galactic with a shareholding of 30.7 million.
The company ended Q1 2023 with a net loss of $159 million, with cash, cash equivalents and marketable securities of $874 million.
