The British online Car Retailer Cazoo Holdings Ltd said that it will go public through a merger with billionaire investor Daniel Och’s special purpose acquisition company. The company will be listed in New York after the deal closes.
The British Car Retailer Cazoo was founded three years ago and it is a used car marketplace based in the UK. The company sells cars in Britain and continental Europe. The special-purpose acquisition company Ajax I will raise about $1.6 billion in proceeds for the company, including $805 million in a cash trust from the SPAC and another $800 million from Ajax’s sponsors. Daniel och plans to join the board.
The deal with Ajax I means Britain loses another company to an overseas bidder despite efforts to reform London’s listing rules to make staying local more attractive for founders. More than $175 billion in takeovers of U.K. companies by foreign buyers have been announced in the past year. In the US the Car Retailer Cazoo will be able to compare its performance to Caravan Co., which went public in 2017.
Online car sales increased during Covid-19 lockdowns as many physical dealerships were shut. Cazoo expected its sales to rise to nearly $1 billion this year, a 300% growth rate. The company w buys and restores used cars and delivers them directly to buyers, which was valued at more than $2 billion after raising funds in October.