An Australian start-up has launched a bid to bail out UK electric car battery business British Vault, which was once praised by former Prime Minister Boris Johnson but fell out of power last week.
Recharge Industries said it submitted an offer to buy the company on Tuesday, a week after Britishvolt collapsed and laid off the majority of its roughly 300 employees.
British Bolt had pledged to build a £3.8 billion gigafactory in Bryce, Northumberland, to produce batteries for electric vehicles. However, the project ran into serious difficulties a few months ago. Because the cash started running low before the site was cleared in preparation for construction.
The company last week appointed an EY-Parthenon manager after failing to raise enough funding to research and develop its Cambodian site.
On Wednesday, Recharge told the Australian Financial Review that it had made a non-binding takeover offer.
Recharge, which is backed by New York investment firm Scale Facilitation, is planning to build a similar battery factory in Geelong, near Melbourne.
David Collard, the Geelong-born founder and chief executive of Scale Facilitation, said the acquisition of the UK operations made strategic sense.
He said: “It is in our interest and arguably ( Australia-British-U.S. security pact) in the spirit of Aukus.”
The bid was taken “seriously”
The UK government said it would “seriously” consider any bid to save the British Vault after an Australian start-up offered a rescue within 11 hours.
Business Minister Nusrat Ghani told the House of Commons on Thursday that the government was committed to industrial land in Northumberland.
Mr Ghani said: All ingredients work. I can’t comment on what’s being speculated in the press, but if there are reliable options in the future, I can confirm that they will of course be taken very seriously.
“We are very committed to this site.
Labor MP Ian Lavery, whose constituency is based in the Cambodian district, has welcomed the Recharge’s bailout bid.
He told the House of Representatives on Wednesday that the bid and expressions of interest from 12 other companies were “very encouraging.”
He added: “We can’t have another false dawn. There will never be another British Bolt with projects, land, plans, everything in place of this magnitude. withdraw from the support of
Britishvolt expects to produce 300,000 battery units annually, meeting demand for around a quarter of the cars sold in the UK market.
The plan was to develop a 95-hectare site that had once housed a coal-fired power plant, using Norwegian hydropower transmitted 447 miles below the North Sea via the world’s longest interconnector.
When first announced in late 2020, the Northeast investment was expected to rival Nissan’s investment in Sunderland in the 1980s.
In January 2022, then-Prime Minister Boris Johnson touted the thousands of skilled jobs that British Bolt’s Gigafactory was expected to create.
Johnson announced that the government is backing the ambitious project with cash from the Automotive Transformation Fund (ATF), saying British Bolt will employ 3,000 people directly and a further 5,000 in the pipeline. I was.
Mr Johnson said the factory would be part of Britain’s “global green industrial revolution”.
However, Britishvolt was unable to raise sufficient funds to continue operations. The company had been promised £100 million in funding from the government, but to protect taxpayers if the company went bankrupt, the money would only be available if the company hit certain milestones. It was available, but never actually materialized.
In recent months, the company has sought to keep itself afloat by raising enough money from private investors, including mining giant Glencore. However, the efforts were insufficient.
Rising interest rates and recession risks have made financing much more difficult for many start-ups, especially those seeking large sums of money for large-scale projects like EV battery factories.
Recession of the automobile industry
Britishvolt’s failure marks a setback for the UK car sector, as industry insiders and experts believe a domestic EV battery factory is essential to prevent UK car production from shifting to mainland Europe. I’m here.
To comply with trade requirements with the European Union, the majority of EVs by value must be manufactured in the UK to avoid EU tariffs.
UK car production fell to its lowest level since 1956 last year as production was hit by a global shortage of semiconductor chips, according to new figures released by the Society of Motor Manufacturers (SMMT).
A total of 775,014 vehicles will be built in 2022, down 9.8% from the previous year’s 859,575 and down 40.5% from 2019 pre-pandemic levels.
However, according to SMMT, the UK produced a record level of electric vehicles last year, with almost a third of all cars being built fully electric or hybrid.
A UK government spokesperson said:
“Our success is evidenced by our £1 billion investment in Sunderland in 2021. We are building on this through a massive investment program to electrify supply chains and create jobs. I have.”
PA Media and Reuters contributed to this report.