North East battery business EV Metals Ƶ collapsed with debts of £47m after its owners placed it into administration, new documents show.
The company was acquired two years by Australian battery chemicals and tech company EV Metals Group (EVMG) when it snapped up the assets of Johnson Matthey’s Battery Materials business in a £50m deal in that included the firm’s site in Abingdon, Oxfordshire, and part of the Billingham research centre, plant and laboratories on Teesside.
However, a new report from the joint administrators – appointed in August – shows that the business failed to bring in any revenue, and that its former CEO Dan Baker, who resigned last year, even advised group bosses to sell off the business to an interested party within months of taking up his role.
Former owners Johnson Matthey retained ownership of the Billingham building and had agreed a deal to lease part of the property to EV Metals Ƶ – but EV Metals workers haven’t been able to get into the building for months after failing to pay rent, and owes around £17.23m to its landlord, including “substantial rent arrears”.
An estimated financial position document shows that parent company EVMG is owed an estimated £22m, while staff are owed £421,470 in redundancy and notice payments and more than £98,000 in pension contribtions. Trade creditors are owed an estimated £6m and unsecured creditors are owed £22.5m. Meanwhile HMRC is said to be owed £1.04m but funds available for preferential creditors total just £184,220.
One part of the report includes background of the company’s affairs which was supplied to administrators by Michael Naylor, a director at EV Metals, who claims that the business was led to believe it would gain contracts after taking over the Teesside and Abingdon sites, but that no deals surfaced. Its Australian owners pledged to continue to support the Ƶ business, however.
Michael Naylor’s report says: “The principal activities of the company were to offer testing and technology development services for high-quality battery materials to customers based in the United Kingdom, Europe and the United States of America, although it had not yet generated revenue from customers at the date of the administration.
“EVMG entered into a Facilities Agreement in November 2022 to provide the company with up to £7m to meet costs whilst contracts were sought with OEM battery manufacturers. In particular, JM led the company to believe that a contract with Sociedad Química y Minera (SQM) would be assigned to the company. This assignment did not occur, and consequently prevented the company from securing an immediate revenue stream to fund the company, and as a critical supply contract, further undermined the ability of the company to implement the business plan of commencing commercial scale production of Cathode Active Materials.
“In December 2022, Dan Baker, who had been working for the company for just over three months, proposed the sale of the Ƶ assets and transfer of personnel to an interested party due to concerns over funding the on-going operations of the Ƶ assets.”
In early 2024, Mr Naylor claims that Johnson Matthey had begun to sell assets and had taken steps to re-let the sites, a move the company director said “significantly damaged commercial negotiations with potential investors”. However, the lease had been forfeited by this point.
The company was eventually put into administration when HMRC and the French authorities demanded a payment of overdue taxes and pension payments, and attempts to secure bridging finance could not deliver funds on time.
The administrators added that discussions continue with strategic investors, to produce a proposal to purchase the assets of the company and resolve back rent issues.
A Johnson Matthey spokesperson said: “The process is at an early stage, so we must see what the administrators conclude into the circumstances of EV Metals Ƶ Ltd’s administration. Johnson Matthey is wholly committed to its Billingham site and the wider operations it runs in Teesside.”
