The liquidator for former vehicle-battery company Britishvolt, which collapsed owing money to a major engineering firm, have decided not to pursue a director over a personal cash guarantee he made to the firm.

In its latest report, RSM said it had decided not to chase an unnamed director of Recharge Production UK – the business that had agreed to buy Britishvolt out of administration – after it failed to pay the agreed sum, despite him giving a personal guarantee.

Britishvolt collapsed in January 2023, with EY appointed as administrators.

In February 2023, Recharge Production UK, a newly formed company set up by Australian start-up Recharge Industries, agreed to buy Britishvolt and its assets for £8.6m, with £6.1m paid at the time and the rest due in instalments.

However, Recharge failed to deliver the final £2.1m owed.

The report notes that Recharge went into compulsory liquidation in May 2024 and that EY lodged a claim with the Official Receiver for money it still owed for the deal plus interest and costs, which had not yet been agreed.

RSM says the money was personally guaranteed by a director at Recharge and that it had considered pursuing a claim against him. Solicitors were hired to consult on this, as well as to help with enquiries into the whereabouts and potential assets of the director, whom RSM says has not responded to correspondence.

The report adds that it is unlikely that the director is based in the UK, so “there would be key challenges around jurisdictional practicalities of enforcement against him”. It says the potential costs of attempting this are unknown. 

RSM also says it is not known how much the director owns in assets, so attempting to enforce the guarantee would “lead to delays in the liquidation and depletion of funds available to creditors”.

No further action will be attempted against him.

Britishvolt’s creditors include mechanical and electrical giant NG Bailey and its subsidiary, Freedom Group, which were owed just over £2m. NG Bailey was also a shareholder in the battery start-up.

In the report, RSM confirms unsecured creditors will only receive 1p to 2p for every pound owed to them by Britishvolt. A first dividend is due to be paid within weeks.

Secured creditors of Britishvolt – its former employees and HMRC – were paid £236,205 and £3m respectively during the administration process, which concluded in October 2024.

Britishvolt’s administration led to the scrapping of a £300m contract for ISG to build a Northumberland gigafactory in January 2023.

ISG collapsed in 2024, with its administrators, EY, citing the impact of the pulled Britishvolt deal, saying it had “negatively impacted cashflow and profitability”.