The new owner of Britishvolt, the company that aimed to build an independent battery factory for electric vehicles, is at risk of being wound up after a former employee started a legal proceeding against it over alleged unpaid wages, writes Howard Mustoe.
The person filed a statutory demand, which is a legal notice a creditor can serve on a debtor, and acts as a prelude to seizing a business’s assets in court, the Financial Times reported.
Recharge Industries, owned by Australian investor David Collard, bought the assets of Britishvolt earlier this year after the British company ran into financial difficulties.
The statutory demand gives Recharge 21 days to pay up or face further action which, if upheld, could mean bankruptcy proceedings.
Britishvolt was the brainchild of former investment banker Orral Nadjari, who saw the looming demand for batteries from carmakers in the UK and a gap in the market for an independent producer.
But it ran out of funding after borrowing became more expensive and Mr Nadjari stepped down. At the time of its demise in January, the company had signed initial deals with carmakers like Aston Martin, but it had secured no firm orders.
Recharge bought some of the assets of Britishvolt, but not the land set aside for the factory in Blyth, Northumberland, which has still not been built.
Meanwhile, most of the biggest carmakers in the UK, including Nissan, JLR, Mini and Aston Martin, have secured alternative supplies for cells. JLR’s owner Tata will build a plant in the UK after securing government funding, Nissan has its own factories near its carbuilding plant in Sunderland and Mini will obtain cells from its owner BMW. Aston Martin has partnered with US electric carmaker Lucid to develop its EVs and cells.
Recharge Industries was approached for comment.
It has so far only paid £6.1m of the £8.6m agreed price for Britishvolt. In August Recharge was accused of missing a payment deadline for the remaining sum.
The final payment for the purchase was due in April, according to EY, which is administering Britishvolt in the wake of its collapse.
EY said it would pursue the payment, suggesting it would allow extra time for a deal to be struck.
Britishvolt collapsed after the Government refused to release funds early to rescue the business.
Recharge Industries’ owner, Scale Facilitation, which Mr Collard controls, said at the time “we dispute we are in default” of the business sale agreement.
Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
