Britishvolt, the company that has been trying to develop an electric vehicle battery factory in north-east England, has called in administrators from EY after failing to find investors for a rescue bid.
The Northumberland-based startup filed for insolvency this morning and administrators from EY were appointed, with nearly all of its 300 staff members made redundant.
Later, it emerged some Britishvolt staff were pursuing a legal claim after being let go via Zoom call.
EY have kept on 26 members of staff who will assist in the sale of the business and its assets.
A last-ditch effort to find investors in recent weeks saw potential interest from an Indonesia-linked consortium of investors, which apparently saw the company valued at just over £30mln, less than a tenth of its worth from a year ago.
EY said Dan Hurd, Jo Robinson and Alan Hudson were appointed joint administrators of Power by Britishvolt Ltd, the main UK company in the wider group, noting that no other entities in the group, including a number of UK entities, are in administration.
Hurd said: “Britishvolt provided a significant opportunity to create jobs and employment, as well as support the development of technology and infrastructure needed to help with the UK’s energy transition. It is disappointing that the company has been unable to fulfil its ambitions and secure the equity funding needed to continue.
“Our priorities as joint administrators are now to protect the interests of the company’s creditors, explore options for a sale of the business and assets, and to support the impacted employees.”
The administrators said they are assessing the options for realising the potential value in the business and assets of the company, including intellectual property and R&D assets.
It was confirmed that Britishvolt entered into administration due to "insufficient equity investment for both the ongoing research it was undertaking and the development of its sites in the Midlands and the North East of England".
The company blamed high energy costs and rising interest rates for delays in the construction project, with the initial stage of production pushed back to 2025, two years later than previously planned.
There were recent hopes that the company, which was hoping to build a £3.8bn EV battery 'gigafactory' in Blyth, could find support from blue-chip backers including Glencore PLC and Ashtead Group PLC.
FTSE 100-listed commodities group Glencore provided emergency funding in November, but this was only enough to keep it going for a few weeks in order to find more investment.
This followed the government rejecting a plea earlier in the autumn to provide early payment from a promised £100mln from its Automotive Transformation Fund, which was refused as the investment was only designed to be available in staged payments as the development of the factory reached certain milestones.
One existing shareholder told the BBC this week that despite offering various possible solutions they felt management "wants the company to go into administration".
This might suggest interest from one or more directors or investors in buying the company in a pre-pack administration deal.
** Update: new details added **