Used car marketplaces Cazoo and Cinch are reported as being among the companies seeking to buy some of Cazoo’s assets.
Cazoo’s marketplace operation, including its intellectual property assets, are the target of MOTORS, Sky News reports.
And ahead of Cazoo’s administration, its recovery advisers Teneo have reportedly done a deal with Constellation Automotive, the parent group of Cinch and Marshall Motor Group, to buy take on of its leasehold properties and save some jobs.
A Cazoo spokesperson said: “This marks the latest step in the planned restructuring of Cazoo which began at the end of last year. Our new marketplace model, where consumers can both buy and sell cars, is revenue generating and performing ahead of expectations with interest from almost one hundred car dealers including many household names wishing to trade on the Cazoo platform.
“Cazoo has successfully restructured and significantly reduced the cash burn of the group, resulting in a cash position in excess of £95m at 30th April 2024 compared to £113m at 31st December 2023, and the platform now has approximately 17,000 cars which is more than double the volume we previously supported and demonstrates the scalability of our technology and the strength of the team.
“We are making efforts to secure the next phase of our business and are grateful to our employees for their hard work and commitment.“
Earlier this week, Cazoo Group said it had filed with the High Court notices of intention to appoint administrators for its subsidiaries Cazoo Holdings, Cazoo Ltd which operates its marketplace business and Cazoo Properties which owns the majority of its leaseholds.
The move gave the subsidiaties a maximum of 10 days protection from creditors’ debt enforcement or until administrators are appointed in the meantime.
A Cazoo spokesperson said: “This marks the latest step in the planned restructuring of Cazoo which began at the end of last year. Our new marketplace model, where consumers can both buy and sell cars, is revenue generating and performing ahead of expectations with interest from almost one hundred car dealers including many household names wishing to trade on the Cazoo platform.
“Cazoo has successfully restructured and significantly reduced the cash burn of the group, resulting in a cash position in excess of £95m at 30th April 2024 compared to £113m at 31st December 2023, and the platform now has approximately 17,000 cars which is more than double the volume we previously supported and demonstrates the scalability of our technology and the strength of the team.
“We are making efforts to secure the next phase of our business and are grateful to our employees for their hard work and commitment.“
Sources pointed out last week that Cazoo appeared to be showing a feed of cars from MOTORS.
Cazoo had already sold off its stock after announcing in March it would cease online car sales and try to pivot into a car advertising marketplace.
Sky reports that several parties are understood to have expressed an interest in Cazoo’s wholesale operation and other vehicle collection sites.
If, as expected, the group does fall into administration, it would underline the rapid implosion of a company which once ranked among Britain’s hottest technology start-ups, although dealers predicted it would find it harder than expected to “disrupt” the UK’s dealer marketplace.
Last week it warned investors it could go bust if it failed to urgently raise capital.
It has sold most of its used car inventory, paid off stocking loans and cut staff numbers. It continues to negotiate the termination of leases, to try and sell customer service centres to third parties and dispose of unwanted assets.
Cazoo said it needed to raise more money to remain viable in the medium to long term.
It said then: “We have been pursuing strategic alternatives for the business or parts thereof, and while we have received interest for parts of the company’s business and assets, we have not received any offers that would, if consummated, enable the company to continue as a going concern in the medium- to long-term.”
In March the online car dealer Cazoo began to sell off its used car stock, transporters and customer care centres as it announced it will switch to a new business model as a car marketplace, competing with rivals such as Auto Trader, Motors and AA Cars.
It said it would look for a new chief executive – the business’s third in five years – as its CEO Paul Whitehead was leaving.
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- Source: https://www.am-online.com/news/motors-and-cinch-linked-with-cazoo-fire-sale
