Bankrupt rocket firm Virgin Orbit obtained a $17 million “stalking horse” bid for its modified 747 provider jet and different aircraft property, because it continues to look at choices throughout Chapter 11 court proceedings.

Virgin Orbit agreed to the phrases of the potential aircraft deal from aerospace venture Stratolaunch, which is growing the world’s largest airplane known as “Roc” as an airborne platform for hypersonic flight testing. A stalking horse bid represents the primary foray on property of a bankrupt firm, and successfully units the minimal bid for any potential competing affords.

According to bankruptcy filings launched Tuesday, the stalking horse settlement adopted “hard-fought negotiations” between the businesses. The deal would see Stratolaunch purchase Virgin Orbit’s aircraft property for money, with a $1.7 million deposit to be made by the client instantly in escrow if the deal goes by way of.

Virgin Orbit filed for bankruptcy safety on April 4 after the company failed to secure a funding lifeline and laid off almost its whole workforce.

“Stratolaunch regularly evaluates find out how to enhance our capability to satisfy the client demand whereas guaranteeing our nation has the aptitude to speed up hypersonic expertise through leap-ahead flight demonstrations,” the corporate mentioned in an announcement.

Stratolaunch is owned by Cerberus Capital Management – which purchased the corporate from the late Microsoft co-founder Paul Allen’s Vulcan in 2019.

Cerberus beforehand regarded to take Richard Branson’s distressed rocket firm non-public, and was among the many closest of a number of potential bidders to placing a deal, however in the end balked, in keeping with an individual aware of the late phases of Virgin Orbit’s attempts to avoid bankruptcy.

Representatives for Cerberus didn’t reply to CNBC requests for touch upon the take-private discussions. A Virgin Orbit spokesperson declined to touch upon the potential Cerberus deal, however mentioned in an announcement that the corporate is “happy that the numbers and high quality of the indications of curiosity replicate the modern concepts and onerous work the group has put into the event of this distinctive system.”

Virgin Orbit beforehand disclosed that it obtained “over 30 indications of curiosity” throughout its bankruptcy course of, with the corporate persevering with to look for a wholesale deal.

A bankruptcy public sale is about for Monday, with a court listening to scheduled for 2 p.m. ET on May 24 to approve the outcomes.