Co-Founders statement
Astra stated on March 7 that co-founders CEO Chris Kemp and CTO Dr. Adam London are going private in order to purchase all of the company’s outstanding shares for $0.50 in cash, which represents a reduction to the closing price of $0.86 per share on March 6. The founders withdrew their earlier offer of $1.50 per share.
It is anticipated that the deal would finalize in 2024’s second quarter. It has received the approval of the requisite number of company shares, and no more stockholder consent is needed. Following closing, the company will be owned by Kemp, London, and many long-term investors.
Astra statement
Astra stated that the take-private agreement is the “only alternative” to declaring bankruptcy in a filing to the SEC on March 1.
Of Astra’s five launches since going public, only two have been successful. One was for the United States Space Force, and the other was for Spaceflight Inc.’s rideshare mission.
In November of last year, the co-founders made a bid to buy the business for $27.8 million, or $1.50 per share. The stock’s closing price on November 8, the day before the initial bid was made public, was more than 32% cheaper than the amended offer price of 50 cents per share.
Among other strategic sale options, the company was allegedly considering selling a 51 percent share in its in-space propulsion business in October.
The co-founders’ choice to go private could be viewed as a calculated move in light of the business’s recent performance. Astra has encountered several difficulties since becoming public, with only two of its five launches ending in success. The choice to go private might allow the business the leeway it needs to overcome these obstacles free from the weight of public criticism.
Prior attempt
The co-founders’ prior attempt to purchase the business for a bigger sum demonstrates their belief in its potential. Their persistent interest in taking the business private indicates that they are confident in its long-term potential, even in light of the current discounted offer.
There have been repercussions to the change. Following the announcement, the company’s shares saw a sharp decline, reflecting investor apprehension over the choice. Observing how the market reacts will be intriguing as the transaction moves forward.
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