The Boeing Company, the world's fifth-largest defense contractor and among the largest global aerospace manufacturers, is investing $20 million in Virgin Galactic ahead of this space tourism company's going public without the need for an IPO.

Virgin Galactic founder Sir Richard Branson Tuesday confirmed the Boeing investment will go to purchasing Virgin Galactic shares once the company becomes a publicly listed firm before the year ends. This milestone will occur after Virgin Galactic merges with publicly traded shell company, Social Capital Hedosophia Holdings.

The merger will effectively transform Virgin Galactic into a publicly traded "New Space" company without having to languish through the complexities of a traditional IPO process. The Boeing-Virgin Galactic deal isn't final but will become official once Virgin Galactic goes public.

The merger will see Social Capital shareholders acquire 49 percent of Virgin Galactic's equity. It will create "the first and only publicly traded commercial human spaceflight company" in the world investors can sink their money into.

The publicly traded Virgin Galactic will have an enterprise value of some $1.5 billion. The company expects to begin generating revenue by 2023.

Virgin Galactic foresees its market capitalization at $2 billion. This sum will be offset by $500 million in cash and marketable securities easily convertible into cash after the merger. The merger will leave current Virgin Galactic CEO George Whitesides in control of the public firm.

"This is the beginning of an important collaboration for the future of air and space travel, which are the natural next steps for our human spaceflight program," said Branson in a statement. "Virgin Galactic and Boeing share a vision of opening access to the world and space, to more people in safe and environmentally responsible ways.

Virgin Galactic is developing commercial spacecraft such as VSS Unity to fly space tourists into the mesosphere or low Earth orbit (LEO). It will also undertake suborbital launches for space science missions for NASA and scientific institutions worldwide.

Virgin Galactic has had several successful test flights over the past few years, but there’s still no indication when its first actual commercial spaceflight will occur.

Social Capital Hedosophia Holdings Corporation is a partnership between the investment firms, Social Capital and Hedosophia. It says its mission is "to create an alternative path to a traditional IPO for disruptive and agile technology companies to achieve their long-term objectives and overcome key deterrents to becoming public." Based in Palo Alto, California, this company is listed on the New York Stock Exchange.

Virgin galactics
Virgin Galactic's SpaceShipTwo flies over the Mojave Desert in California shortly before successfully completing a test flight that broke the sound barrier, April 29, 2013. REUTERS/Gene Blevins/File Photo