One public investor in the company told this column that it “believed in its technology”.
However, it is unclear at this stage whether anything will be clawed back for the Scottish and UK governments which both invested heavily in the Forres space launch firm.
Some of the UK funds are known to have been used as wages and will not be recouped.
Most of the company’s staff were based in Forres. (Image: Orbex)
Orbex was founded in 2015 and was developing a low-carbon micro-launch rocket designed to place small satellites into low Earth orbit called Prime.
Public investment in Orbex totalled £76.7m, with £29m from the Scottish Government’s Scottish National Investment Bank, and £26m from the UK Government.
The huge potential loss will bring more scrutiny to SNIB, but perhaps looming more significantly is the impact on the UK rocket space launch sector, and the Sutherland spaceport over which Orbex had stewardship.
The site is seen as the sector launchpad.
The company was unable to reach its latest fundraising targets, administrators said.
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It had already secured £138.5m, made up of £33.3m in grants and £105m in equity.
A bank spokesperson said: “We invested in Orbex because we believed in its technology and the key role it could play in realising the potential of the space sector in the UK and Scotland.
“However, in common with other companies in this industry, Orbex is a capital intense business and ultimately could not secure the additional investment it needed to progress with developing its plans.”
The spokesperson also said: “As Scotland’s development bank, we were established to fill an identified gap in the Scottish funding landscape by supporting scale-up companies with high-growth potential.
“We enter into all investments with confidence, but risk is inherent in all investment and we are mandated to take on higher risk than other commercial investors to drive growth in the economy.
“We have always said that regrettably, some company failures will be inevitable, and our strategy is based on the entire portfolio, over the long term.”
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The UK Department for Science, Innovation and Technology invested £26m in total in Orbex.
The majority of this funding has largely gone towards wages for high-skilled workers at the company, and so will not be recouped.
The UK Space Agency supported the company with £20m in grant funding. Around £7m of this was for milestones that the company has not yet delivered, and this will be re-allocated to other space projects.
The department said it “undertook the appropriate financial, technical, and legal due diligence”.
A UK Government spokesperson said: “We remain committed to supporting our dynamic space sector.
“The UK attracts some of the highest levels of private space investment in Europe, and we are home to over 1,900 innovative space companies supporting tens of thousands of high-skilled jobs across the country.
“We recognise this will be a very worrying time for staff at Orbex. Space launch is a highly competitive sector, and it has always been the case that some companies will fail. We will be setting out more details about our plans for developing key national space capabilities, including launch, in due course.”
The administrator said: “The administration follows the unsuccessful conclusion of a Series D funding round and parallel merger and acquisition discussions.
“Orbex was exposed to the capital-intensive nature of launch vehicle development and long lead times to revenue so these outcomes left the business without the capital required to continue its development programme.”
The company employed 163 staff.