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Virgin Galactic Chairman Sells Personal Stake for $213 Million

The venture-capital investor Chamath Palihapitiya, chairman of Virgin Galactic, sold his personal stake in Virgin Galactic for about $213 million.

The venture-capital investor Chamath Palihapitiya, chairman of Virgin Galactic  (SPCE) , this week sold his personal stake in the space-travel company for about $213 million, according to regulatory filings.

Palihapitiya sold 6.2 million shares Tuesday and Wednesday, according to U.S. Securities and Exchange Commission filings.

He still owns 15.8 million shares, about a 6.5% stake, with his partner, Ian Osborne, through investment firm Social Capital Hedosophia.

Virgin Galactic’s shares have more than doubled (up 150%) since the Las Cruces, N.M., company merged with Social Capital’s first SPAC in 2019, according to Bloomberg.

The transaction raised about $800 million, with Palihapitiya also directly contributing $100 million.

In December Palihapitiya sold about 3.8 million shares of his stake in Virgin Galactic, saying at the time that he wanted to "help manage my liquidity." 

Virgin Galactic shares at last check were down 7.1% at $28.14.

Separately, George Whitesides, longtime chief executive of Virgin Galactic, left the company, saying saying he'd decided to pursue potential opportunities in public service. He will remain chairman of a four-member Space Advisory Board.  

Palihapitiya, a former Facebook  (FB)  executive, has launched so-called blank-check companies that have merged with businesses across health insurance, financial services and real estate. These include Opendoor Technologies and Clover Health Investments.

Last month, the prominent short-seller Hindenburg Research said Palihapitiya had misled investors as Clover had prepared to go public. 

Hindenburg said Clover was under investigation from the Department of Justice and that the investigation was not disclosed to investors. 

In its response to the Hindenburg report, Clover said it has received inquiries from the DOJ but did not believe the inquiries were material to its investors. 

The company characterized the DOJ inquiries as standard practice since Clover works with the Medicare system.

Clover also said on Thursday that it received a letter from the SEC following Hindenburg’s report and said it would cooperate with the agency.