UK firm Vertical Aerospace has secured 1,000 pre-orders for its all electric ‘flying taxis’ from Virgin Atlantic and American Airlines. The company has also agreed to merge with London based Broadstone Acquisition Corp, and will become publicly traded on the New York Stock Exchange.

The aerospace firm, which is developing an all-electric aircraft, confirmed the merger with special purpose acquisition company Broadstone Acquisition Corp in a deal valuing the company at nearly $2bn.

The transaction with Broadstone – a US ‘blank cheque’ company owned by London-based business tycoon Hugh Osmond, founder of Punch Taverns – is expected to close in the second half of 2021.

Vertical Aerospace said it had already received pre-orders from Dublin-based aircraft leasing company Avolon and American Airlines, and a pre-order option from Virgin Atlantic, worth $4bn.

The business has also secured investment from Microsoft’s venture capital fund M12, American Airlines, Avolon, Honeywell and Rolls-Royce. European Internet company Rocket Internet and 40 North – a related investment business of Standard Industries – also have a stake in the company.

Mr Osmond, chairman of Broadstone, said: “Transportation is one of the next big sectors of the global economy to be disrupted at scale.

“Vertical has a clear commercial plan to challenge short-haul air travel, and to create new markets where neither cars nor public transport can cope with demand.”

Vertical Aerospace is planning to develop and launch a Virgin Atlantic-branded short-haul electric vertical take-off and landing (eVTOL) network in the UK. The partnership includes an option for Virgin Atlantic to acquire up to 150 eVTOL VA-X4 aircraft.

According to Shai Weiss, Virgin Atlantic’s chief executive, the joint venture will see the launch of electric vehicles at UK airport hubs, including London Heathrow, Manchester and Gatwick.

Vertical Aerospace said it would also work with American Airlines on passenger operations and infrastructure development in the US.

Derek Kerr, chief financial officer of American Airlines, said emerging technologies were “critical” in the race to reduce carbon emissions.

“For years, American has led the industry in investing in newer, more fuel-efficient aircraft,” he said. “[This] partnership is another example of that commitment, and an investment in the future of air mobility.”

Vertical Aerospace is targeting profitability and cash flow breaking even with annual sales of fewer than 100 aircraft.

The business said it had assembled an in-house engineering team with backgrounds from senior levels of Rolls-Royce, Airbus, UK Ministry of Defence, Jaguar Land Rover and General Dynamics.

Vertical Aerospace was founded in 2016 by Ovo Energy boss Stephen Fitzpatrick to develop eVTOL aircraft.

Last year, the company unveiled its designs for what it said would be the world’s first certified all-electric vertical take-off and landing (eVTOL) aircraft.

According to the company, the vehicle will be able to carry four passengers for 120 miles at speeds of more than 200mph.

The aircraft is currently in development, with flight testing expected to take place this year, followed by certification in 2024 and initial commercial services starting shortly afterwards.

Stephen Fitzpatrick, Vertical chief executive and founder, said: “This is the most exciting time in aviation for almost a century; electrification will transform flying in the 21st century in the same way the jet engine did 70 years ago.

“The announcement brings together some of the largest and most respected technology and aeronautical businesses in the world and together we can achieve our aim of making the VA-X4 the first zero carbon aircraft that most people will fly on.

The manufacturer, which has said previously that assembly will take place in the UK, has already flown multiple full-scale prototypes.