AN electric vehicle parts firm will move “onwards and upwards” in a £150m merger, its boss has told The Northern Echo.

Sevcon has signed a definitive agreement to be bought by fellow automotive sector operator BorgWarner.

Last night, Matt Boyle, president and chief executive at Gateshead-based Sevcon, said the deal will provide a catalyst for fresh growth, adding it will have no impact on its regional base or moves to create 200 jobs in a North- East factory expansion.

Sevcon is known for supplying controllers for the allelectric Renault Twizy city car, and has lucrative deals to develop an electric drivetrain for a Chinese and European vehicle maker and arrangements to help develop controls capable of electrifying drive systems for a British supercar company.

However, Mr Boyle, speaking from the company’s new Team Valley factory, told the Echo its agreement with BorgWarner, which works across combustion, hybrid and electric vehicle products, will provide scope for more growth.

He said: “BorgWarner are a big player and a £10bn corporation.

“They are a tier one supplier to the automotive industry, have a huge combustion business and previously bought Remy International (that makes alternators, starter motors and electric traction motors).

“We have complementary skills and it is onwards and upwards for the business.

“The proposed merger provides substantial value to our stockholders and the chance for Sevcon to maximise previous growth investments and capitalise on greater opportunities as part of a much larger organisation with significant market presence.

“We are hoping to grow Team Valley in the way we have planned.

“That is continuing.”

Bosses say the terms of the agreement provide for Borg- Warner to acquire all outstanding shares of Sevcon’s common stock for $22 per share in cash, and all of the outstanding shares of Sevcon’s Series A Convertible Preferred Stock.

They added the total transaction value is expected to be approximately $200m (£150m).

James Verrier, BorgWarner president and chief executive, said the tie-up will provide an exciting opportunity.

He added: “This supports our strategy to supply leading technology for all types of propulsion systems; combustion, hybrid and electric and we look forward to welcoming Sevcon’s talented employees.”

Earlier this year, Sevcon revealed it would recruit an additional 200 technicians and engineers, who will complement its move to larger headquarters less than 200 yards away from its existing base, to ramp up manufacturing and testing work.

Officials said an initial 20 staff will join the Gateshead firm over the coming months, with further phased additions coming thereafter.

The business previously revealed contracts worth £320m in its order book and has also opened an office near Oxford, which could yield work with nearby Formula One teams and motoring companies.