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(AP) -- British billionaire Sir Richard Branson signed a deal Tuesday to sell about a third of his space travel startup Virgin Galactic to a Mideast investment fund, giving the venture an influx of cash at a time when the global recession has dried up funding sources.

Aabar Investments will pay $280 million for a 32 percent share of the company, according to the agreement that also gives the wealthy Persian Gulf sheikdom of Abu Dhabi a chance to set up its own space flight industry.

Branson and Aabar CEO Mohamed Al-Husseiny signed the deal on a wind-swept runway at the Experimental Aircraft Association's annual AirVenture convention, next to the WhiteKnightTwo aircraft designed to launch a ship into space. Branson, decked out in black Virgin flight suit, took his first ride in WhiteKnightTwo minutes after signing the paperwork.

"I'm looking forward to getting into the plane now," Branson told scores of onlookers after he signed and shook Al-Husseiny's hand. He then immediately left the stage and climbed aboard.

Virgin Group has pumped more than $100 million into its space flight venture since 2004. The company is working to develop flight vehicles with Scaled Composites, the Mojave, Calif.-based aeronautical firm that won the X Prize to build the first privately funded manned space ship.

Branson envisions using planes like the twin-fuselage WhiteKnightTwo to lift satellites and passenger spacecraft to about 50,000 feet from a base in New Mexico. The satellite or spacecraft would then detach from the plane and blast into space.

Virgin Galactic officials hope to begin commercial flights within two years. The company hasn't yet proven it can take people into space and bring them back, but it's already taken 300 reservations for $200,000 each.

Aabar, meanwhile, has emerged as one of the most active investment funds in Abu Dhabi, the richest of seven semiautonomous sheikdoms that make up the United Arab Emirates with almost all the country's vast oil reserves.

Aabar bought 9.1 percent of Mercedes-Benz maker Daimler AG in March, and earlier this month bought 4 percent of San Carlos, California-based electric car producer Tesla Motors.

In addition to the ownership shares, the Virgin Galactic deal grants the state-controlled fund exclusive regional rights to launch Virgin Galactic tourism and satellites. Aabar officials say they plan to pay an extra $100 million plus transaction costs to fund a program to launch small satellites into orbit and build a spaceport in Abu Dhabi.

A rival space tourism company, Space Adventures Ltd., announced plans in 2006 to build a $265 million spaceport in the northern UAE sheikdom of Ras al-Khaimah, but almost no progress has been made since.

Virgin Galactic President Will Whitehorn said the pact gives Virgin Galactic enough funding to focus on both satellites and manned space flight. The company hopes to start launching satellites off planes like WhiteKnightTwo from Abu Dhabi within three years, he said.

"By Aabar coming on board, we can speed up that capability," he said. "We believe there's a big market opportunity here."

WhiteKnightTwo made its first public flight Monday at AirVenture, which draws tens of thousands of aviation lovers from around the world every year. The plane's crew had been limited to test pilots, but Virgin Galactic officials said Branson got special permission from the Federal Aviation Administration to go up with the crew Tuesday.

As Branson taxied down the runway behind him, Al-Husseiny said he thinks the billionaire can make space flight a reality.

"Looking at the potential for how exciting this would be ... we're glad to be partners in this," Al-Husseiny said. "I must admit there's a cool factor to all this."

Emerging from WhiteKnightTwo after landing, Branson removed his helmet, pushed his shoulder-length blond hair out of his eyes and grinned. He said the craft flew beautifully and thanked Aabar for putting trust in him and his company.

"All together," the billionaire said, "a day almost too untrue to be real." 

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