Well, I must have gotten in a day too early yesterday $SPCE (+1,38%) . That's why I've just doubled the position again. Who could have guessed that they would issue new shares today of all days to redeem their senior bonds.
Virgin Galactic Holdings, Inc (NYSE:SPCE) announced on Tuesday that it will redeem up to USD 30.5 million of its 9.80% First Lien Notes due December 31, 2028. The company intends to redeem the principal amounts originally due on September 30, 2026 and December 31, 2027 by issuing ordinary shares to the bondholders.
According to the company's announcement, the redemption includes the remaining USD 20.4 million of the mandatory amount due on September 30, 2026 and at least USD 10.1 million due on December 31, 2027. Virgin Galactic had already repaid a principal amount of USD 10 million on May 18, 2026.
Repayment is scheduled for June 10, 2026 at par plus accrued and unpaid interest. The exact amount of the bonds redeemed and the number of shares issued will be determined based on the volume-weighted average price of Virgin Galactic's common stock during a five-day observation period. If the share price falls below a specified floor during this period, the company will not redeem the corresponding bond amount, which could result in a total redemption amount of less than USD 30.5 million.
If fully executed, Virgin Galactic would not be required to make any further principal payments on the senior notes until March 31, 2028. The company said the move was part of its capital and cash management strategy as it prepares to commence commercial operations in the fourth quarter of 2026.
