After Astra Loses 99% of Its Value, Founders Take Rocket Firm Private

Astra Space, a California-based rocket company, has announced it will go private at a valuation significantly lower than its $2.1 billion debut in 2021. The company's market value is about $13 million at current levels. The company's co-founders, Chris Kemp and Adam London, will acquire all outstanding shares at $0.50 each, well below the current trading price of $0.80. Astra has faced challenges, with only two successful launches out of seven attempts of its Rocket 3 vehicle. The company pivoted to the larger Rocket 4 in 2022 but has yet to conduct test launches.

Astra faces competition from established players like Rocket Lab and Firefly, as well as new entrants such as ABL Space and Stoke Space. The company's future remains uncertain as it navigates a competitive small launch market, with SpaceX's Transporter missions offering lower prices by launching dozens of satellites simultaneously on its Falcon 9 booster.

Re:

[Rinnon]

Why was this amateur hour allowed to go public in the first place?

Who's more foolish: the fool, or the fool who bought his stocks?

Re:

[r1348]

You know it's a scam when they go public through a SPAC merger.

A better source

[ISayWeOnlyToBePolite]

The arstechnica article doesn't make sense, a better source is https://finance.yahoo.com/news... [yahoo.com]

Re:

[Required Snark]

An even funnier source [wolfstreet.com]

Astra Space had reverse-split its shares in September 2023 where 15 shares were reduced to just one share, to get the share price to jump 15-fold to keep it from getting delisted for a while even as the shares continued to collapse. The reverse split gave them ample room to collapse into without having to deal with fractional pennies.

But we’re not amused, said the stock jockeys that hadn’t gotten out in time. Or maybe they were amused. Maybe, it’s just one big video

Bro, do you even lift?

[Pseudonymous Powers]

Seems to me like just two rockets that can reach orbit would cost more than 13 million by themselves.

Re:

[timeOday]

Not necessarily if you still owed money on the loan you used to make them.

Exit scam?

[reanjr]

Sounds like an exit scam. Tank the company so you can gobble up the assets on a fire sale.

Re:

[Pascoea]

That was my thought when I read the article. They offered to buy it at $1.50/share, a premium to the share price at the time, the board told them no. So now, a year later, they are buying it for $0.50/share, quite a bit lower than $0.80/share it was when they announced.

Re:

[Spazmania]

That's my thought as well. The company with all its rocketry assets has $18M in cash, $17M in debt and they're buying it outright for another $17M. Unless their assets are pure vapor, that's a heck of a bargain.

IPO was $147

[Anonymous Coward]

The founders sold their shares for $147 at the IPO, and now they're buying them back at $0.50. I would call that an extremely successful short sale.

Lawsuit bait

[imunfair]

Seems like they're just asking for a lawsuit based on the low buyout price, it isn't unusual for a price to be below the current market value, but usually that's due to the negotiation happening during a time when the price was lower, and being a premium on some previous price. In this situation 52 cents was the lowest the stock had ever been, so not only are they not paying a premium on any price that would have existed during negotiation, they're paying less.

And given that they didn't hold a public vote

Misleading company name

[djgl]

In 1985 a company called SES Astra S.A. was founded who operates the most important TV satellites for Europe.
Sounds like Astra Space tried to jump on that bandwagon.