Shares of Virgin Galactic fell in trading on Thursday after the company announced plans to raise up to $500 million in debt.
“The company intends to use the net proceeds from the offering to fund working capital, general and administrative matters and capital expenditures to accelerate the development of its spacecraft fleet,” Virgin Galactic said in a statment.
The space tourism company intends to raise $425 million from the sale of 2027 convertible senior notes through a private offering, with an additional $75 million option also expected to be granted to buyers.
Virgin Galactic stock fell as much as 16% in trading from its previous close of $12.37.
Sir Richard Branson’s Virgin Galactic went public via a merger with a special purpose acquisition company, or SPAC, from Chamath Palihapitiya in October 2019.
At the time Virgin Galactic said it would begin flying customers in 2020, and Branson and three other company employees did make a headline-grabbing test spaceflight in July 2021.
But since then delays to its spacecraft testing and development have steadily pushed back commercial service to late this year at the earliest.