Virgin Orbit has begun drawing up detailed contingency plans for its insolvency days after halting its operations and furloughing its workforce.

Sky News has learnt that the commercial space satellite venture founded by Sir Richard Branson's Virgin Group is working with Alvarez & Marsal (A&M) and Ducera, two restructuring firms, on fallback plans in the event that it cannot secure new funding.

The decision to line up the advisers underlines the parlous nature of Virgin Orbit's finances, even as it continues talks with a small number of prospective investors about providing sufficient funding to restart its operations.

Virgin Orbit is 75%-owned by Sir Richard's holding company, with its shares listed on the Nasdaq exchange in New York.

Its value has further plummeted following the failure of its inaugural British mission in Cornwall in January.

After going public in 2021 through a merger with a special purpose acquisition company in a $3.7bn (£3bn) deal, its listed shares are now valued at just $217m (£177m).

Sources said the insolvency planning work involving A&M and Ducera was being run out of the US.

A&M also worked on plans for the administration of Virgin Atlantic Airways as it raced to recapitalise itself during the COVID-19 pandemic.

The identities of the parties interested in funding Virgin Orbit on an ongoing basis were unclear on Sunday evening, although one source said that Boeing, which has invested in the company previously, was not in talks with it.

Virgin Orbit is understood to be aiming to secure additional capital during the course of this week, they added.

Dan Hart, Virgin Orbit's chief executive, has been hoping to launch a further mission in the coming weeks, but that prospect is remote unless the company can secure new capital.

A Virgin Orbit spokesperson said last week: "Virgin Orbit is initiating a company-wide operational pause, effective March 16, 2023, and anticipates providing an update on go-forward operations in the coming weeks.

"On the ops side, our investigation is nearly complete and our next production rocket with the needed modification incorporated is in the final stages of integration and test."

Sources close to Virgin Group said that Sir Richard's privately held empire had supported Virgin Orbit to the tune of more than $1bn (£818bn), including $60m (£49m) since November 2022.

One insider said the funding provided to the company had not been sufficient to counter the strong headwinds and liquidity crisis facing it.

Virgin Orbit was confident it was taking decisive action to protect employees and the company's assets while it continued to evaluate alternative options, they added.

Virgin Orbit was established in 2017, with a focus on operating launch missions for small commercial satellites from an adapted Virgin Atlantic Boeing 747 plane.

The company has made four successful missions, launching 33 satellites to their desired orbit, according to a spokesperson.

Taking Virgin Orbit public at a multi-billion dollar valuation was seen as a vindication of Sir Richard's efforts to construct a lucrative business empire in the space technology sector.

In 2019, he merged Virgin Galactic, his space tourism operation, with Social Capital Hedosophia, another SPAC, in a deal which heralded the ongoing deluge of so-called 'blank cheque' companies.

Virgin Orbit was spun out of Virgin Galactic and has been run for years by Mr Hart, a former Boeing executive.