Startup Britishvolt — an electric vehicle battery business building what will be the UK’s largest gigafactory — is facing a multimillion-pound court case for allegedly breaching a contract it had with a private equity firm.
It’s another bump in what has been a slightly fraught journey for the company, which the UK government has hailed as key to both the country’s low-carbon future and the revival of its post-industrial areas. Investors have poured millions into the development of these "gigafactories" — Tesla CEO Elon Musk coined the term — to accelerate the manufacture of green vehicles.
Private equity firm Evans Randall is suing Britishvolt for £10.2m in unpaid fees it claims it’s owed for helping the startup secure £1.7bn in investment. The fees are equal to the 0.6% fee that the firm says it was supposed to receive for any investment it helped Britishvolt land.
Britishvolt has enjoyed a speedy rise to fame in the last few months. In January, it received £100m in funding from the UK government — a substantial sum for a direct state investment into a startup. It has also secured the backing of FTSE100 mining conglomerate Glencore.
Britishvolt’s gigafactory will be the UK’s first large-scale battery plant. Japanese carmaker Nissan is also working on a battery factory in the UK, in conjunction with Envision, a Chinese battery company.
Across Europe, Northvolt, a Swedish startup, has raised $6.5bn for its gigafactories and is constructing its second plant. In France, there’s Verkor, which is constructing a plant in Dunkirk.
In a document filed to the Commercial Court in London last month and seen by Sifted, Evans Randall claims that it signed an agreement with Britishvolt to act as its exclusive UK real estate adviser, a role which involved securing investment for the gigafactory.
In January 2022, Britishvolt received £1.7bn from two investors: Tritax and abrdn. Evans Randall claims it was instrumental to securing the investment, but that Britishvolt started handling communications with the investor itself and then terminated its contract with Evans Randall without paying the fee.
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Both Evans Randall and Britishvolt declined to comment.
The court case isn’t the first controversy to dog the startup. At the end of 2020, news broke that Lars Carlstrom, one of the cofounders, had been convicted of tax fraud in his native Sweden in the late 1990s.
Carlstrom resigned from Britishvolt, saying he didn’t want to become a distraction for the company. Carlstrom now lives in Italy and runs Italvolt, which is also a proposed battery plant.
Responding to media enquiries at the time, Carlstrom said the conviction was 25 years ago and that he had always intended to pass on his chairmanship of Britishvolt.
“Mr Carlstrom no longer has any involvement with Britishvolt. He relinquished his shares after stepping away to pursue his own ambitions in Italy in 2021. Britishvolt and Italvolt are not linked, nor associated, with one another,” Britishvolt told Sifted.
Around the time that Carlstrom left the company, Britishvolt also underwent a significant change of tack, moving its proposed factory from south Wales to Northumberland, over 300 miles away.
Britishvolt told Sifted that the Northumberland site offered better access to renewable energy and a bigger plot. “The decision was amicable between the Welsh government and Britishvolt,” a spokesperson said.