BlackRock-Backed Online Car Dealer Cazoo Weighs London IPO

(Bloomberg) -- Cazoo Ltd., the British online used car platform backed by some of the world’s best-known investors, is weighing plans for an initial public offering in London, according to people familiar with the matter.

Cazoo is speaking with potential advisers about a possible listing as soon as this year, the people said, asking not to be identified discussing confidential information.

The U.K. firm is reviewing the merits of an IPO this year after the successful listing of German online used-car dealer Auto1 Group SE, which surged in trading after raising 1.8 billion euros ($2.2 billion) earlier this month, the people said.

Deliberations are in the early stages and no final decision has been made, according to the people. Cazoo has also attracted takeover interest from special purpose acquisition companies, one of the people said.

A representative for Cazoo said the company didn’t comment on market rumors and would make an announcement regarding any IPO at the appropriate time.

Cazoo buys and restores used cars before selling them online, delivering them direct to its customers’ homes. It has generated revenue of more than 200 million pounds ($280 million) since launching in 2019, according to a spokesman.

In October, Cazoo completed a 240 million-pound funding round from investors including D1 Capital Partners and BlackRock Inc., taking the total amount it has raised to 450 million pounds. That round valued the company at more than $2 billion. Private equity firm L Catterton and Mubadala Capital, the investment arm of Abu Dhabi’s sovereign wealth fund, are among its other backers.

Daily Mail & General Trust Plc shares soared as much as 28% Friday, the most intraday since 2008, on the news of a potential offering. The London-based media, information and events group holds a roughly 20% stake in Cazoo and has been selling assets under Chief Executive Officer Paul Zwillenberg. It said there was no certainty of any outcome for shareholders in a regulatory announcement following the price move.

DMGT has realized gains on similar previous investments: in 2018 it sold its stake in ZPG, the owner of property marketplace Zoopla, for 642 million pounds. Like Cazoo, ZPG was founded by British internet entrepreneur Alex Chesterman.

Goldman Sachs Group Inc. and Numis Corp. Plc worked on Cazoo’s fundraising last year, putting them in a good position to get a role on the IPO if it goes ahead.

An IPO could add to a strong run for technology listings in the U.K. Tech and internet companies raised more than $4 billion in IPOs on U.K. exchanges in 2020, the most since 2015, according to data compiled by Bloomberg.

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