Shares of Virgin Galactic Holdings rose more than 8% in after-hours trading after the Tustin-based space tourism company revealed that a court has granted preliminary approval of its proposed settlement with plaintiffs.
The U.S. District Court for the Eastern District of New York issued an order granting preliminary approval of a settlement resolving all claims pending in two cases.
The proposed settlement will result in a $2.75 million payment by the company’s insurers, half of which the company will retain. Once the District Court issues final approval of the settlement, all claims in these actions and in any currently pending actions related to or based on any of the allegations in these actions are expected to be dismissed or declared moot. Virgin Galactic’s current and former officer and directors, who are defendants in these actions, have denied all of the claims and allegations of wrongdoing.
Shares in after-hours trading climbed 8.2% to $4.90. During regular trading today, they climbed 20% to $4.53 and a $473 million market cap. Yesterday, the company announced that its prototype spaceship, called VSS United, has returned to the skies in New Mexico for the first of several anticipated glide flights.
