Britishvolt administrators in 'negotiations' with potential new buyers as deal remains 'in default'

The Britishvolt site at Cambois in Northumberland is regarded as one of the best locations for a car battery gigafactory anywhere in Europe. Credit: ITV Tyne Tees

Administrators for Northumberland car battery startup Britishvolt say they are in "negotiations" with potential buyers while the Australian company, which had agreed to take over the business, remains "in default".

Britishvolt, which had planned to build a £4 billion gigafactory in Cambois near Blyth, went into administration in January 2023 after running out of money.

Administrators EY agreed to sell the business to Australian startup Recharge Industries for £8.57 million, but in August it emerged that the final instalment to buy the company was "unpaid and overdue".

Recharge Industries' parent company, Scale Facilitation, has previously denied being in default.

In an update posted by EY today, the administrators said that there have been "discussions with a number of additional parties who have intimated that they may be interested in acquiring the proposed gigafactory site in Northumberland."

The Progress Report, sent to creditors by EY Joint Administrator Joanne Robinson, added that Recharge Industries "continues to remain in default of the Business Sale Agreement".

It went on to say that "whilst the Joint Administrators have not terminated the BSA, negotiations are ongoing with other interested parties."

What has happened so far?

Britishvolt, which had planned to build a £3.8 billion battery gigafactory with a promise of £100m in grant funding from the UK government, entered administration on 17 January 2023.

On 27 February 2023 it was announced that the Australian battery startup Recharge Industries, owned by New York-based Scale Facilitation, would take over the business.

In May that year it emerged that Recharge Industries had yet to take possession of the land in Cambois, Northumberland, where a battery factory could be built. The company had refused to settle a £9.7 million pound debt with Katch Fund Solutions, which would allow it to take ownership of the land, until a dispute with Northumberland County Council of a buy-back clause over the land is resolved.

In a statement, Northumberland County Council said: "We are continuing to work closely with representatives of Recharge on a range of financial and legal points associated with this significant transaction and investment into our county."

In June, the Australian offices of Scale Facilitation, which is owned by businessman David A. Collard, were raided by the serious financial crime task force of the Australian Federal Police and the Australian Tax Office as part of an investigation into an alleged taxation fraud.

Britishvolt had plans to build a gigafactory in Northumberland but the company went into administration in 2023. Credit: Britishvolt

What happens next?

EY said that it is are unable to provide more detailed commentary given the commercial sensitivities surrounding these negotiations.

The administration period has been extended to January 2025 to allow either Recharge Industries to "pay the remaining outstanding deferred consideration" or to sell the "remaining assets to an alternative purchaser."

Recharge Industries' parent company, Scale Facilitation, has been approached for comment.

In August the company said “we dispute we are in default” of the business sale agreement.

They added that “the timing of the final instalment to the administrator is linked to a funding facility which when closed will also cover the cost of the land acquisition and provide additional working capital for the project. The financier is in direct contact with the counterparties, and we anticipate closing in August following a period of significant due diligence.”

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