Bristol's Vertical Aerospace "in rescue talks with creditors"

Bristol-based Vertical Aerospace, the tech company pioneering electric, zero-emissions aviation which was founded by Stephen FitzPatrick, the founder of Ovo Energy, is reportedly in rescue talks with its single largest creditor, Jason Muldrick.

When it announced its half year results in September, Vertical Aerospace reiterated that it would need to raise capital to fund its future operations and remain as a going concern.

At that time it announced it completed Phase 1 of piloted testing on its new VX4 prototype at the Vertical Flight Test Centre.

The aircraft conducted multiple piloted tethered flights and ground runs, across 20 piloted test sorties, completing a total of 70 individual test points.

Of that latest achievement, Stuart Simpson, CEO at Vertical, said: “During the past few months we have delivered our most advanced full-scale VX4 prototype, have gone from first powered ground test to 'wheels up’ in just one week and completed the first phase of our piloted test flight programme. Every day I continue to be deeply impressed by the phenomenal engineers we have and the progress we are making here in Bristol as we build a new generation of aviation."

The company said that it will share a business update tomorrow (Tuesday November 12).

Vertical has 1,500 pre-orders of the VX4, with customers across four continents, including Virgin Atlantic, American Airlines, Japan Airlines, GOL and Bristow.

As of June 30, 2024, Vertical had cash and cash equivalents of £67 million. In May Vertical parted company with Rolls-Royce on the design of an Electric Propulsion Unit (EPU). Under the agreement, Vertical received $34 million from Rolls-Royce which is expected to cover the anticipated costs of an alternative EPU design contract and provided an extension to the cash runway.

This followed Rolls-Royce's announcement in November 2023 of its intention to seek a partner or buyer for its advanced air mobility activities. Vertical is already working with other EPU suppliers and does not anticipate this having any impact on the completion of their prototypes.

In September Rolls-Royce announced the closure of its Electrical’s Advanced Air Mobility activities (first announced last year). It had previously committed to design the system architecture of the whole electrical propulsion system, the electric power system and monitoring system to support operations.

Last month, Oxfordshire's hypersonic aviation firm Reaction Engines went into administration.

Strategic shareholders BAE Systems and Rolls-Royce Holdings were reportedly unwilling to provide enough capital to bail it out.