Glasgow truck manufacturing agency enters administration after funding deal bid

Hydrogen Vehicle Systems Limited, based in Glasgow, was sold for £145,000 in a pre-pack administration deal after failing to raise enough investment over two years

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A UK lorry manufacturing firm has been sold following its collapse into administration. Hydrogen Vehicle Systems Limited, which had its base in Glasgow, went into administration due to funding difficulties.

The firm had more than 70 staff and was sold for £145,000. The sale also maintained “the ability to continue with ongoing research and development projects”, reports The Herald.

According to the administrators, parts of the business were sold in a pre-pack arrangement in a move which “preserved the value of the assets and the intellectual property”. Paul Dounis and Mark Harper of Opus Restructuring were appointed joint administrators to handle the process. They said in the report: “The company was incorporated on September 13, 2017, and was a Glasgow-based manufacturer and designer of hydrogen-electric vehicles.

“The company operated from a leased premises in Glasgow, previously employing circa 70 plus staff across research, engineering and development roles, along with general administrative and finance roles.

“The company operated in conjunction with multiple other research companies and institutes to develop its proprietary systems and technology through funds received from investors and UK government grants.”

The administrators added: “By January 2024, the company had failed to raise any investment over the previous two years, resulting in carrying ordinary unsecured debt of £7million over and above the floating charge holder’s investment of £25million.

“During this time, staff had started to notice a reduction in spending, resulting in staff opting to move on from the company.”, reports the Express.

“In response, the company began to implement cost cutting procedures, including a reduction in director salaries, limiting purchase order approvals, workforce restrictions and eventually the closure of the company’s head office in Glasgow in May 2024.

“By January 2025, the company was being operated on a limited budget by the directors and a small group of founding staff members working on a voluntary basis.

“Work was limited to essential tasks to allow the company to continue to operate, with contractor usage limited to an as-needed basis.”

Following a marketing campaign where one potential offer was made, “an additional offer was received from H2 Vehicle Systems Ltd (H2VS), a connected company,” the administrators said, adding: “The offer of £145,000 from H2VS was accepted for the acquisition of the business and assets, both tangible and intangible.

“The directors concluded that pursuing the strategy of a pre-pack sale in administration, rather than immediately closing down the company, was the most appropriate course of action to maximise the return to the creditors in the circumstances.

“This preserved the value of the assets and the intellectual property, while preserving the ability to continue with ongoing research and development projects.”