Abu Dhabi-based investor Aabar has announced it's buying a third of Virgin Galactic--Richard Branson's nascent space company. And as part of the $280 million deal, the middle east will get a spaceport and satellite-launch facility.
Aabar is an investment company, owned by the country's government, and formerly its business centered on petroleum investments. Its recent investments have given it a 9% stake in Daimler and a strategic share in Tesla motors, and it seems the Virgin Galactic investment is quite a departure for Aabar. The deal is worth $280 million, and equates to a 32% stake in the Galactic which has been wholly owned by Richard Branson's Virgin Group until now. That values Galactic at around $900 million, representing an amazing success for the world's first commercial space line, which has yet to fully reveal its first space vehicles, let alone fly them into space.
That Branson will make a success of this new business is pretty certain--hence Aabar's investment. And the influx of money will reinforce Virgin Galactic at a critical stage in its business development (it's in the final shakedown stages of building its spacecraft and testing its White Knight carrier vehicle) in a climate which has seen many other sources of finance drying up.
As part of the joint venture, Virgin has agreed to give Aabar the rights to all Virgin Galactic traffic in the region, and will site a new space port in Abu Dhabi. There's also a plan to use Galactic facilities to carry out scientific space research, and Aabar's set aside an additional $100 million to develop a small satellite launching capability with Virgin--it looks like it will use a similar twin carrier/space-bound vehicle setup to that which will carry paying passengers into space.
At some point Virgin Galactic, with its famous engineering partner Scaled Composites, will develop an orbital launch capability. And this may be what Aabar is looking at, in terms of long-term returns on its investment--the orbital vehicle business represents seriously big piles of cash.
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