Virgin Galactic Looks at Partnerships With Abu Dhabi Companies
Virgin Galactic, billionaire Richard Branson’s venture that plans to launch commercial space flights, is interested in forming partnerships in Abu Dhabi as the emirate builds itself into a global aerospace hub.
Virgin Galactic, 37.8 percent-owned by the Abu Dhabi government’s Aabar Investments (AABAR) wealth fund, wants “collaborations in operations or future technology or even education” with companies in the emirate, Chief Executive Officer George Whitesides said in a phone interview.
Project costs to date amount to $200 million, while about 500 people have signed up for space flights at $200,000 a ticket, giving the company potential revenue of $100 million, Whitesides said in the interview from Virgin Galactic’s headquarters in Las Cruces, New Mexico, adding that the majority of buyers paid the full amount.
Abu Dhabi, the capital of the United Arab Emirates and holder of 7 percent of the world’s proven oil reserves, plans to spend $500 billion on industry, tourism and culture through 2030 to reduce reliance on petroleum. Among the projects is a business jet that state-owned Mubadala Aerospace, a maker of aircraft parts, plans to build before the end of the decade.
The emirate is “going about it in a really smart way” to develop an aerospace industry, by manufacturing composite materials and working with partners such as Lockheed-Martin Corp. (LMT), Whitesides said.
Virgin Galactic may make “a number of announcements” about joint projects during the Global Aerospace Summit in Abu Dhabi in April, Whitesides said, declining to specify potential partners. The conference will also provide a chance for Whitesides to sign up more space-flight passengers from the Persian Gulf, he said. Customers from the region currently number almost 10, he said in the interview Feb. 24.
Aabar’s investment in Virgin Galactic stands at $380 million, Whitesides said. The rocket maker’s budget shows there’s no need for further funding until commercial operations begin in the second half of 2013, and the company isn’t looking to sell additional stakes, Whitesides said.
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