UK space sector faces uncertainty after Orbex collapse

In February 2026, Orbital Express Launch Ltd, commonly known as Orbex, one of Scotland’s most high-profile rocket developers, entered administration after failing to secure critical funding and rescue deals. This development has placed approximately 150 skilled jobs at risk and raised broader questions about the resilience and strategic direction of the UK’s domestic space launch industry.

Company Background and Ambitions

Founded in 2015 and headquartered in Forres, Moray, Orbex had been developing the Prime micro-launcher and the larger Proxima rocket, aiming to establish sovereign UK launch capability from Scottish soil. The company had received £26 million in government-backed loans and had secured commercial commitments from several satellite operators.

Despite these advantages, Orbex could not complete its Series D funding round, and merger talks with European start-up The Exploration Company failed. This left the company with no viable path to continue operations.

Infrastructure and Asset Considerations

Orbex’s launch operations had shifted from the planned Sutherland Spaceport to the licensed SaxaVord Spaceport in Shetland. While the administration process provides temporary protection for the company, administrators are exploring the sale of key assets, including launch facilities, equipment, and intellectual property.

Competitor Skyrora has expressed preliminary interest in acquiring select Orbex assets, potentially investing up to £10 million to preserve UK space capabilities. The company emphasized that securing these assets could be “vital to preserving UK space capability” and ensuring that technology and taxpayer-funded investments remain under domestic ownership.

Legal and Commercial Implications

Orbex’s administration highlights important lessons for investors, advisors, and policymakers. Even with government support, funding gaps and financial risks remain a major challenge for high-tech space companies.

It also shows why diligence is essential when working with public and private partners. Contracts need to clearly define who is responsible for risks, and companies must follow rules around cross-border investment and government funding.

Finally, the UK’s ability to launch satellites from home soil depends on keeping domestic space companies healthy. The collapse of Orbex shows why taking action to protect key assets or combine resources can be critical for maintaining technology, infrastructure, and jobs in the sector.

Looking Ahead: Lessons and Opportunities for UK Space

Despite Orbex’s setback, the UK space industry continues to move forward. Other companies are developing new launch technologies and building infrastructure, and opportunities may arise for consolidation under firms like Skyrora. Such moves could help preserve jobs, protect technology and infrastructure, and maintain momentum toward the UK’s goal of sovereign launch capability.

Orbex’s administration also offers important lessons for investors, legal advisors, and policymakers. It highlights the need for careful planning, clear legal structures, and sustainable investment strategies when supporting high-risk, high-tech ventures. Ultimately, the case shows the delicate balance between encouraging innovation, managing investment risk, and ensuring proper governance in the UK space sector, illustrating both the challenges and opportunities of fostering domestic launch capability.

Jen Paton, Partner: jpa@bto.co.uk / 0141 221 8012

Gavin Stewart, Trainee Solicitor: gst@bto.co.uk / 0141 221 8012