Virgin Galactic chairman sells US$213m stake

[LONDON] Chamath Palihapitiya, the billionaire investor who has helped drive the frenzied growth of blank-cheque companies, sold his personal holding in the space-tourism company founded by Richard Branson, raising $213 million.

Mr Palihapitiya disposed of 6.2 million shares at an average price of US$34.32 this week, based on a filing with the US Securities and Exchange Commission. He still owns 15.8 million shares with his partner Ian Osborne through investment firm Social Capital Hedosophia, amounting to about a 6.5 per cent stake. Mr Palihapitiya previously sold shares worth almost US$100 million in December, filings show.

Virgin Galactic's shares have increased about 150 per cent since the Las Cruces, New Mexico-based company merged with Social Capital's first SPAC in 2019.

Mr Palihapitiya has since launched blank-cheque companies that have merged with businesses across health insurance, financial services and real estate including Opendoor Technologies and Clover Health Investments Corp.

Along the way, 44-year-old Palihapitiya has made a fortune for himself and his investors. The former Facebook executive has raised more than US$4 billion through blank-cheque firms, using social media to talk up the investments and becoming one of the most prominent figures in the SPAC phenomenon, which has everyone from Colin Kaepernick to former House Speaker Paul Ryan racing to market their own.

He's also a lightning rod for skeptics who dismiss his success as the product of self-promotion and see blank-cheque companies as proof of a bubble inflated by government money-printing.

Social Capital's merger with Virgin Galactic - where Mr Palihapitiya is chairman - made the Branson startup the world's first publicly traded space-travel venture. The transaction raised about US$800 million, with Mr Palihapitiya also directly contributing US$100 million.

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