Chamath Palihapitiya to sell remaining $ 213 million to Virgin Galactic, shares drop 15%
Virgin Galactic leaders in front of the New York Stock Exchange, from left: CEO George Whitesides, Founder Richard Branson, and Chairman Chamath Palihapitiya.
Billionaire investor Chamath Palihapitiya, the chairman of Virgin Galactic, who floated the company through a SPAC deal in 2019, sold his remaining personal stake this week, according to a securities filing.
Palihapitiya sold approximately 6.2 million Virgin Galactic shares valued at approximately $ 213 million at average selling prices on Tuesday and Wednesday.
He still indirectly owns around 15.8 million shares through Social Capital Hedosophia Holdings – the special purpose vehicle he founded with investor Ian Osborne.
Palihapitiya said in a statement to CNBC that he plans to divert the sale “into a large investment I’m making in combating climate change.”
“The details of this investment will be released over the next few months. I remain committed to the team, mission and prospects of Virgin Galactic,” Palihapitiya said in the statement.
Virgin Galactic shares were down as much as 15% in trading on Friday from the previous closing price of $ 30.30 per share. The company’s stock, which has fallen more than 30% this week alone, has lost more than half its value since hitting an all-time high of $ 62.80 in early February.
Shares have remained positive since the start of 2021, but rose around 7%.
The Virgin Galactic carrier jet and spaceship prepare for launch from Spaceport America in New Mexico on December 12, 2020.
Palihapitiya sold around 3.8 million shares of its stake in Virgin Galactic in December. At the time, Palihapitiya said he sold the shares “to manage my liquidity as I am funding several new projects starting in 2021.”
“I remain committed and excited about the future of SPCE. I just wanted to be transparent,” Palihapitiya said in a tweet.
Its final sales come a week after Virgin Galactic announced further delays in its spacecraft testing program. Now commercial flights are not expected to start until early 2022. When Palihapitiya’s SPAC merged with Sir Richard Branson’s company, Virgin Galactic expected commercial spaceflight to begin in the summer of 2020.
In addition, former Virgin Galactic CEO George Whitesides is stepping down as chief space officer, a spokesman told CNBC on Wednesday. Whitesides, who stepped down as CEO for former Disney executive Michael Colglazier last year, plans to explore public service opportunities, the company said.
Whitesides remains chairman of Virgin Galactic’s Space Advisory Board, and he and his wife own space maps that were purchased in 2005.
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