Australian firm Recharge Industries will take over battery maker Britishvolt after striking a deal with management on Sunday night in the UK.
The deal revives hopes of building a £3.8bn (A$6.7bn) “gigafactory” in northern England, the backbone of a plan to modernize Britain’s car industry and supply the next generation of vehicles. electric cars built in the UK.
The deal was finalized three weeks after Recharge, an Australian company owned by New York-based investment firm Scale Facilitation, was named as a preferred bidder, placing a huge opportunity and burden on a startup that has yet to build a project. .
Australian-born Scale Facilitation founder and chief executive David Collard told the Guardian that the factory and an associated supplier park, where components are manufactured, was still a focus.
“We are working closely with one of the UK’s leading fund managers looking to build a development team,” said Collard.
Recharge also plans to build a battery factory in Geelong, a former car manufacturing hub in Australia, free of Chinese and Russian materials.
Britishvolt was planning to build its 30GWh plant in phases to take advantage of rising EV demand ahead of the UK’s 2030 ban on new petrol and diesel cars. The factory, located near Blyth in Northumberland, was expected to employ around 3,000 people when operating at full capacity.
It had £100m in conditional funding from the British government, but it failed to meet a number of hurdles.
Britishvolt collapsed last month after running out of cash, with its slump partly attributed to the sizable sums spent on battery technology and research. Part of Recharge’s pitch was focused on its existing relationship with US lithium-iron battery developer C4V, removing the need to develop new technology.
The completion of the deal with EY directors was first reported by the BBC. That means the revived Britishvolt could manufacture batteries using Australian minerals, including lithium, US technology and British manufacturing, representing the same three countries in the Aukus trilateral security pact.
Collard said the company would initially focus on “developing a robust UK-specific business plan with global alignment”.
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Recharge has shown interest in producing batteries for energy storage and for the defense industry, which differs from Britishvolt’s original aim of producing batteries for 300,000 vehicles a year.
Recharge’s proposal won the backing of the British government’s trade envoy to Australia, former England cricketer Ian Botham. It beat offers from existing investors from Britishvolt, private equity firm Greybull Capital and Saudi British Bank, backed by HSBC.
The UK will need 10 high-volume battery manufacturing facilities, or gigafactories, by 2040, according to British research body The Faraday Institution. It currently has a Chinese-owned battery factory next to Nissan’s factory in Sunderland, and lags behind many European countries.
The future of car manufacturing is closely tied to battery production, as automotive brands look to pool production facilities. China is the dominant EV battery manufacturer in the world.