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Australian Firm Fails to Pay Staff After Buying Britishvolt

An Australian firm, Recharge Industries, which acquired Britishvolt after it went into administration earlier this year, has reportedly not paid its UK staff for the past four months. This development has further complicated the takeover, as Recharge Industries still owes £2.5m of the purchase price, even though it was expected to be paid months ago. Despite this, sources within the company insist that a deal with a new investor is imminent.

Britishvolt, a battery maker startup, had plans to build a ┬ú4bn “gigafactory” to produce battery packs for electric vehicles. The facility was intended to be constructed on the premises of an old power station in Northumberland. However, due to financial issues, the company fell into administration. Administrators at EY subsequently sold Britishvolt’s assets to Recharge Industries, who agreed to pay ┬ú8.57m for the acquisition. While ┬ú6.1m was paid initially, the remaining amount is yet to be fulfilled.

Although most of Britishvolt’s employees were made redundant after the company went into administration, 26 individuals were retained. However, sources reveal that Recharge Industries stopped paying these employees in July, leading to more than half of them leaving the company. Additionally, the new owners have failed to meet their pension commitments.

Moreover, staff complain of being unable to work as they have been locked out of computer systems, as the IT contractor has not been paid. Recharge Industries, owned by Scale Facilitation, intends to use the Blyth site to manufacture vehicle batteries for the Australian military. To gain control of the land, they not only need to pay the outstanding £2.47m to EY but also raise an additional £11m to settle a financial claim by property investor Katch.

While Recharge Industries claims that funding from a new investor is imminent, Britishvolt employees have little confidence in this statement. The employees have expressed skepticism due to repeated broken promises, as Recharge Industries has failed to reveal the identity of the supposed investor. One employee described the claims of the company’s owner, David Collard, as “BS.”

David Collard, confident in his ability to prove his critics wrong, must act quickly to secure the new investment. However, doubts have been raised regarding his financial and industry background, with top officials at Northumberland County Council questioning his ability to deliver on a project that could generate thousands of jobs.

Recharge Industries has faced difficulties in securing the necessary funding for the Britishvolt project. A tax raid in June contributed to investor apprehension, although sources close to Collard stated that it resulted from a misunderstanding of the interaction between US and Australian tax filings. Scale Facilitation has denied any wrongdoing. Another obstacle is the buyback clause held by Northumberland County Council, which allows them to reclaim the Blyth site if substantial progress in development is not made by December 2024.

EY, the administrator overseeing the affair, has defended its role in the transaction. The company asserts that the £6.1m received from Recharge Industries was substantially higher than other viable offers submitted to the administrators. AI legalese decoder can help in this situation by analyzing legal documents and contracts to ensure that all parties involved are fulfilling their obligations and meeting the required financial commitments. This technology can also offer insights into potential risks and issues that may arise during business transactions, allowing stakeholders to make informed decisions and mitigate any challenges.

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