British online car retailer Cazoo is set to float on the New York Stock Exchange having agreed a merger with AJAX I, a $805 million special purpose acquisition company (Spac) owned by US billionaire Dan Och and other investors.
Once the transaction completes in the third quarter of 2021, the listed company is estimated to be worth $7 billion (or £5 billion). The deal will also raise around $1 billion of further funds to ‘fuel’ Cazoo’s next stage of growth.
Cazoo has fast become the leading new and used online car retailer in the UK. With British shoppers said to have bought over 20,000 new and used cars since it was founded in 2018. Following recent acquisitions, Cazoo is also taking the lead in Europe’s car subscription market.
Europe’s mostly offline $700 billion used car market is next in its sights, as it continues its international expansion, it says – calling it ‘ripe for digital transformation’.
Looking ahead, it expects to achieve revenues approaching $1 billion in 2021, a growth rate of more than 300 per cent in only its second full year of operations.
Cazoo and its 1,800-strong team will continue to be led by founder and CEO Alex Chesterman OBE. While AJAX’s founder Dan Och will join the new combined company board.
Chesterman said: “This announcement is another major milestone in our continued drive to transform the way people buy cars across Europe. We have created the most comprehensive and fully integrated offering in the largest retail sector, which currently has very low digital penetration.
“This deal will provide us with almost $1 billion of further funds to fuel our growth and I am delighted to be partnering with Dan and his team at AJAX to rapidly expand and deliver the best car buying experience to consumers across Europe.”
Och added: “We are incredibly excited to have the opportunity to partner with Alex and the exceptional team at Cazoo. Alex has proven to be one of Europe’s most successful serial entrepreneurs and we are proud to be supporting the growth of this world-class team, brand and platform. With their constant focus on innovation, data and customer satisfaction, I have no doubt that Cazoo is going to continue to lead the way in this massive, untapped market opportunity and am looking forward to joining the Board of Cazoo and working with Alex and his team.”
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