Recharge Industries, the Australian firm that acquired the bankrupt Britishvolt earlier this year, has unveiled an ambitious plan for its newly acquired Northumberland site. They intend to supply batteries for the Australian military, capitalizing on the strategic advantage of the site near Blyth. These transformative plans arrived in the wake of complex negotiations with administrators EY, who, though declining to comment, shared a belief that a deal was near completion according to those familiar with the matter.
Securing this coveted Northumberland site is paramount on Recharge’s agenda. The company aspires to manufacture batteries not only for military utilization, but also for heavy commercial and static storage purposes. Further cementing ties in Australia, Recharge has engaged EDEA, an Australian energy firm, for consultations to assemble power units for military vehicles.
On the financial front, the agreement entails Recharge settling EY’s outstanding fees for £2.5m. An additional £11m would then be transferred to property investor Katch, who maintains a financial claim on the site.
Despite the focus on military, commercial, and stationary storage, the manufacturing plant’s opening should not be expected to immediately churn out batteries for mass market vehicles. Nevertheless, this novel endeavor is projected to invigorate the employment sector in the north east of England, leading to the creation of numerous job opportunities.
Critics of the deal, however, have raised concerns about Recharge’s capability to deliver a multi-billion-pound plant, including some within Northumberland County Council. Britishvolt’s failure to secure government funding before it went under intensifies questions about financial robustness, although Recharge Industries asserts that it doesn’t require such assistance.
The acquisition of Britishvolt by Recharge, a start-up owned by New York-based investment fund, Scale Facilitation, has brought fresh hope, but also trepidation. Scale Facilitation is led by Australian David Collard, a finance specialist whose entry into the battery manufacturing arena is relatively recent.
Despite these apprehensions, the counsel of a distinguished European investor, known for his ties to strong industrial products and infrastructure, has provided a reassurance of funding for the land deal. Also on the cards is a proposed scheme that would see Recharge Industries rent the site from a joint venture, most of which is owned by property investors Tritax, backed by Abrdn, a prominent fund management group.
There are further plans in the pipeline to utilize the site as an accessible connection point for offshore wind farms in the North Sea. In this way, it would provide a link to the UK mainland, generating additional revenue for the site owner.
Yet, uncertainties around the project persist, mainly due to the anonymity of the investor instrumental in securing the site. Financing the construction of the gigafactory is a venture rich with inherent risks that need to be managed and navigated over time.
Moreover, firms controlled by Recharge’s owner, David Collard, are currently under tax investigations in Australia. Mr. Collard, however, insists on the company’s full cooperation with these investigations.
Despite the project’s potential impact on UK industrial ambitions, Recharge has had minimal interactions with UK government departments. Nevertheless, unlike their predecessors, they do not seek any financial aid from the government.
Recharge’s audacious plan to produce batteries in Northumberland for the Australian military may seem improbable—especially given that the company also plans to develop a battery plant in Geelong, Australia. However, advocates argue for the geographical advantages and power links of the Cambois site, believing it provides a faster route to production, and a model that may be replicated elsewhere.
As the decisive moment approaches to finalize the site, optimism swirls among those privy to the ongoing developments. Yet, doubts linger about the financial and engineering prowess of the new owners needed to actualize this groundbreaking plant.
