EY says takeover by Recharge Industries is set to be finalised within a week
An Australian battery manufacturing start-up owned by a US investor group looks set to buy collapsed British company Britishvolt and revive plans to build the UK's first 'gigafactory' in Northumberland.
EY, the accounting firm that has been administrating the sale of the company, said late on Friday it had entered into an agreement with Recharge Industries and expected the acquisition to be completed within seven days.
Britishvolt was put into administration last month after running out of money and failing to reach the construction milestones required to access a £100m government grant.
The company was planning a major battery manufacturing plant at the site of a former coal power plant near Cambois which it claimed would generate more than 3,000 jobs and help catalyse the wider electric vehicle (EV) manufacturing industry in the UK.
EY said it had assessed interest from a number of bidders for the company and its assets, which include the factory site, before picking the New York investment firm that owns Recharge Industries as its top choice.
"EY is pleased to announce that the joint administrators have entered into an agreement with Scale Facilitation Partners LLC and its indirectly wholly owned subsidiary Recharge Industries Pty Ltd to be the preferred bidder in acquiring the majority of the business and assets of Power by Britishvolt Limited (in administration)," it said. "This follows a process conducted by EY that involved the consideration of multiple approaches from interested parties and numerous offers received."
Recharge Industries' bid was selected over offers from a current group of shareholders, private equity group Greybull Capital, and the Saudi British Bank, insiders told the Financial Times.
The Australian company is also planning a gigafactory near Melbourne that is aiming to supply batteries to car companies and energy storage developers from 2024.
In an interview with the Financial Times last month, Recharge Industries CEO Richard Collard indicated that if its bid was successful the firm would shift Britishvolt's existing plans to focus on the development of batteries based on lithium technologies, rather than cobalt and nickel batteries, and supply batteries to the energy market, as well as to automotive producers.
In a statement, Collard said: "We're thrilled to be progressing with our proposed bid for Britishvolt and can't wait to get started making a reality of our plans to build the UK's first gigafactory. After a competitive and rigorous process, we're confident our proposal will deliver a strong outcome for all involved."
The news comes as EY has faced criticism from some industry figures for taking on the role as administrator of the collapsed battery start-up, given its long-time role as advisor to the firm.
It is not unusual for advisers to be appointed as administrators, but the row feeds into a live debate over the question of tightening regulation of conflicts of interest in the insolvency sector.
Insiders told the Financial Times that EY was being paid £500,000 a month by Britishvolt before the company's collapse and had close ties with the company from its inception, having been instrumental in creating its business plan.
According to the report, insiders alleged that EY had used its relationship with the start-up to boost its corporate sustainability credentials and demonstrate its connections to government.
Britishvolt's chief financial officer, head of finance systems and innovation, and chief of staff to its chief executive were all hired from the consultancy in 2021.
EY had not responded to BusinessGreen's request for comment at the time of going to press, but it told the FT that it was "an unsecured creditor of the company at the time of the appointment of administrators [because of fees owed to it for its earlier advice], but will not vote on any creditor resolutions that may be required as part of the administration process".
* This article was originally published here