Trackwise in administration after failed automotive bid
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Flexible circuit pioneer Trackwise has entered administration after losing out on a potential deal with a Tier One automotive supplier.
Trackwise had been looking to a sale or an equity investment to keep it going after a decision on making flexible circuit boards for EV battery packs was delayed until last week.
“Since September 2022, the board of directors of Trackwise has been exploring longer term strategic investment partnerships in order to support development and conversion of the pipeline of identified sales opportunities, notably for EV battery cell connection systems (CCS) and also for other medical and aerospace sales opportunities,” said the company.
“Regrettably the board has now concluded that it is required to take the necessary steps to preserve value for creditors. Consequently, the Board has resolved to appoint Joint Administrators. The likely outcome for creditors of the Company is currently unknown and it is not expected that the appointment of the Joint Administrators will enable there to be any return to the shareholders of Trackwise.”
The announcement does not affect Stevenage Circuits, which Trackwise acquired in April 2020 and is not in administration. Initial offers have been received for the business and are being assessed.
“It is beyond words the disappointment that I feel in having to make this announcement. So many colleagues – past and present, customers, suppliers, collaborators and investors have worked tirelessly, sacrificed so much, dug so deep, to develop Trackwise. I thank them all for their support over many years and am so very sorry that all of that has come to this. It is certainly not for the lack of trying,” said Philip Johnston, CEO of Trackwise.
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The company appointed a new chair at the start of 2023.
“I am truly sorry that the strategy set out for Trackwise in December has failed to produce the hoped for result,” said Andrew Lapping, Chair of Trackwise.
“Chris Pennison and I joined the Board in January in the knowledge that the £4.8m fundraise only gave the Company a limited cash runway and would therefore require positive commercial progress in H1 2023. Our short-term strategy was dependent on securing a nomination from a Tier 1 for automotive OEM, a project that has been worked on for at least 12 months. A decision on this was originally expected in Q1 or in April but in the event, a final decision was only made in late July.”
“If we had won the nomination, it would have allowed Trackwise to seek to raise sufficient funds to take it to the start of production and significant cashflow. Moreover, it would have provided the company with much needed verification, giving our customer pipeline further confidence to trade with Trackwise. Confirmation that we had lost out on the nomination was a huge disappointment for everyone. We had expended a huge amount of effort to give us the best possible chance of success.”
“The result of not winning the nomination, particularly after the delay in the award decision, inevitably left our cash runway severely depleted. After consultation, and with no obvious source of new funding, there was simply no choice but to put the Company up for sale and this action greatly increased creditor pressure. I want to assure all that we have explored all possible routes to raising finance without success.”
www.trackwise.co.uk; www.stevenagecircuits.co.uk
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