The group has signed non-binding heads of terms to consolidate Smith Electric Vehicles (SEVUK) and (Smith Electric Vehicles US) SEVUS.
Tanfield, which received a £37m offer to buy out its electric vehicle division from its US sister company, is now set to enter a merger instead.
March’s original offer to buy Tanfield owned Smith Electric Vehicles came from its partners in Smith Electric Vehicles US, in which the Tanfield owns a 49 percent stake.
But in an announcement to the Stock Exchange this morning it appeared Tanfield had decided to retain an interest in the fast-growing US electric vehicle market by merging SEVUK with SEVUS.
The company said that the merger was a consequence of a review of how to optimize shareholder value and of general market opportunities. Under these updated terms of the consolidation Tanfield Group is expected to retain a significant interest in the combined entity and share in its future growth and opportunity.