Britishvolt's administrators sold assets for a fraction of losses

The record

Britishvolt Limited, later renamed Power by Britishvolt Limited, company number 12381543, incorporated 31 December 2019, entered administration when its directors appointed Daniel Hurd, Joanne Robinson and Alan Hudson of Ernst & Young LLP as Joint Administrators at 10am on 17 January 2023. The Joint Administrators' statement of proposals, delivered to creditors on 13 March 2023 and filed at Companies House on 22 March 2023 as recorded in the filing history, records that the company had raised £167.5 million of equity since a 2020 seed round and around £33.8 million of loan and convertible debt, against 11-month management accounts to 30 November 2022 showing a net loss of £82 million and accumulated losses exceeding £154 million.

Following an accelerated sale process that drew interest from 88 parties, the business and substantially all its assets were sold to Recharge Production UK Limited, completing on 26 February 2023, for total consideration of £8,576,343.

What the documents establish

The proposals distinguish what the company had raised from what its administration recovered. The £167.5 million equity figure and the accumulated losses are the administrators' own account of the company's financial history, drawn from its accounting records; the £8.6 million sale consideration is what the accelerated process actually realised for creditors, a figure the administrators state was materially above the next best alternative offer received. The document also records that a secured lender, Katch Fund Solutions, held roughly £9.7 million of debt secured against a subsidiary's land, and that the sale consideration figure excludes any separate amount the purchaser might pay to release that security. The administrators attribute the appointment to missed equity-funding targets against a planned £800 million 2022 raise, not to a single named cause.

The operating read

Editorially, the gap between £167.5 million raised and £8.6 million recovered through a sale of business and assets illustrates a distinction worth carrying into any pre-appointment sale review: consideration in an accelerated administration sale reflects what a buyer will pay for a going concern's remaining assets under a compressed timetable, not a valuation of capital previously invested or losses previously incurred. Investors and unsecured creditors in a capital-intensive, pre-revenue business should expect a sale value driven by near-term deliverability, not by cumulative spend.

What to check before you decide

Before drawing conclusions from an administrators' statement of proposals about who bears a shortfall, check the following.

• Does the stated sale consideration include or exclude amounts payable separately to secured creditors to release their security?
• What objective, of the three set out in Schedule B1 to the Insolvency Act 1986, are the administrators pursuing, and does that match the outcome described?
• Does the document distinguish audited historical figures from draft management accounts when stating losses or funding raised?

An administrators' statement of proposals records what a sale process actually realised, not what a business was once said to be worth. Britishvolt's filing shows both numbers plainly, and the distance between them is the more informative fact.