Subscribe Free
in Technology / Business & Finance

Abu Dhabi takes major stake in Virgin Galactic space tourism venture

Posted 28 July 2009 · Add Comment

Abu Dhabi's Aabar Investments and Virgin Group announced today that they have agreed to enter a strategic partnership, which will see Aabar take an equity stake in the world's first commercial spaceline - Virgin Galactic. To date, Virgin Galactic has been wholly owned and funded by Sir Richard Branson's Virgin Group.

The deal will be formally signed today at the EAA AirVenture air show in Oshkosh, Wisconsin by Sir Richard Branson and Mohamed Badawy Al-Husseiny, CEO of Aabar. Virgin Galactic’s new carrier space launch vehicle, WhiteKnightTwo (VMS Eve) is making its public demonstration flying debut in Oshkosh.

Virginb's White Knight 2 over Oshkosh
Under the deal, Aabar will invest approximately US$280m and take around a 32% stake in Virgin Galactic’s holding company, valuing the business at about $900m. The transaction is subject to obtaining regulatory clearances in the United States and elsewhere.  Additionally, Aabar has committed $100m (plus transaction cost) to fund a small satellite launch capability, subject to the development of a full business plan. It will also gain exclusive regional rights, subject to regulatory clearances, to host Virgin Galactic tourism and scientific research space flights. Finally, Aabar has plans to build spaceport facilities in Abu Dhabi.

Commenting on the acquisition, HE Khadem Al Qubaisi, Chairman of Aabar, said, “I am pleased to announce this partnership. Virgin Galactic is the leader in the realm of space tourism, having successfully established a potential global market for its offering in a very short span of time. Aabar’s stake in Virgin Galactic will open a new avenue of opportunity for Abu Dhabi in this unique and dynamic business. The significant partnership not only falls in line with Abu Dhabi’s larger plans to inculcate technology research and science at a grassroots level but also complements its aim to be the international tourism capital of the region.”

Virgin Galactic is in the final stages of developing and testing commercial sub-orbital space vehicles based on the prototype SpaceShipOne, that flew successfully to space and back three times in 2004. The unique and innovative designs of the vehicles will transform the cost, safety and environmental impact of access to space for people, science research and education.

Sir Richard said, “We are delighted to partner with Aabar in a strategic deal that is a first for Virgin Galactic. The initiative will leverage the solid financial backing of Aabar and the pioneering technology and strong global relationships of Virgin Galactic. This exciting deal is indicative of the interesting and high value investments that mark the UAE’s commercial portfolio.”

The new joint venture also proposes to undertake additional development which would enable the space system to launch small satellites at unprecedented levels of cost, reliability and flexibility.

“This transaction carries multiple potential for the creation of an exceptional platform for space infrastructure such as research labs, space centre for commercial travel and much more,” said Mohamed Badawy Al-Husseiny.

Virgin Group has invested over $100m in Virgin Galactic since its formation in late 2004. The development of its new vehicles is being carried out by Scaled Composites, the renowned Mojave CA based aeronautical firm, owned by Northrop Grumman and led by Burt Rutan.

Scaled Composites was responsible for designing and building SpaceShipOne which won the $10m X Prize in 2004 as the first privately funded manned space vehicle. The system is highly innovative: it utilises a carrier aircraft for launch of the spaceship at high altitude, a controllable and benign hybrid rocket motor and a unique wing feathering design for a failsafe re-entry. The spaceship makes a runway landing rendering it almost entirely reusable.

The new commercial vehicles are now at an advanced stage of development. VMS Eve, VG’s new carrier aircraft is well into its test flight programme and is performing flawlessly.  It is the world’s largest all carbon composite aircraft and has a unique high altitude, heavy lift capability.  Sir Richard Branson is due to be onboard VMS Eve as a member of the crew for a demonstration flight during EAA AirVenture at Oshkosh on Tuesday 28th July.

The new spacecraft, SpaceShipTwo will commence its own test flight programme before the end of 2009.  Both vehicles offer a unique environment for space tourism and a wide range of science research applications as well as a platform for small satellite launch.

Patrick McCall, the Virgin Group Commercial Director responsible for the transaction said, “We are building a great partnership for the development of the world’s first private sector integrated human and payload space launch system. All of us at Virgin Galactic are very much looking forward to working with Aabar’s Chairman, HE Khadem Al Qubaisi, its CEO Mohamed Badawy Al-Husseiny and the whole Aabar team as we move forward together at the cutting edge of the coming industrial revolution in space access. I would also like to take this opportunity to thank Brandt Mowry, the senior vice-president of corporate development who managed the transaction on behalf of Virgin Group.”

Virgin Galactic expects the capital infusion to fully fund the company through to its commencement of commercial operations.

Credit Suisse acted as the exclusive financial advisor and placement agent to Virgin Galactic regarding the transaction.
 

Other Stories
Advertisement
Latest News

Qatar Airways extends USAID ROUTES partnership to combat wildlife trafficking

Qatar Airways has extended its participation in the USAID ROUTES (Reducing Opportunities for Unlawful Transport of Endangered Species) Partnership, reinforcing its commitment to combat illegal trafficking of wildlife and its

Turkish Airlines enters codeshare with Finnair

Turkish Airlines has entered into a code share agreement with Finnair.

Pegasus adds new direct routes as Turkey reopens

Pegasus has launched twice daily direct flights to Istanbul Sabiha Gökçen Airport.

Competition will give us an extra edge

Etihad Airways believes that the more airlines – even direct competitors – that start operating into its Abu Dhabi base, the better. Alan Dron finds out why.

Etihad Airways offers guests a complimentary ticket to Expo 2020 Dubai

Etihad Airways is giving all of its guests travelling into or via Abu Dhabi a complimentary ticket to Expo 2020 Dubai, the biggest cultural gathering in the world taking place between 1 October 2021 and 31 March 2022.

Emirates becomes first airline to implement IATA Travel Pass across six continents

Emirates has become the first airline to implement the International Air Transport Association's IATA Travel Pass solution on six continents, as it rolls out this digital health pass to customers at all its destinations.

WDS SK2601090322
See us at
Aviation Africa 2022DIACC BT0809131121DAS21_BTWorld Defence Show 2022