Cavendish Corporate Finance advises Carsite on their minority share sale to Tesco Plc

Published April 05, 2011

Cavendish Corporate Finance LLP is pleased to announce it has closed an expansion capital fundraising round for Carsite, the innovative and market leading online used car retailer that enables fleet and lease companies to sell their stock direct to the public. The transaction involved Tesco Plc investing an undisclosed amount to take a minority stake, with the ability to increase their shareholding in subsequent years.

Cavendish have been advising the owners of Carsite since 2008, assisting them with an initial fundraising and working closely with them on their strategic direction to ascertain who would be the most appropriate investor to help drive the business forward. It became very clear that Tesco's ambitions to expand into new areas, as well as its desires to grow its financial services offering, meant that they would be the ideal investor and partner for the business. Cavendish also assisted Carsite in bolstering its management team, by introducing Sir Trevor Chinn, the motor industry veteran, who subsequently became Chairman of the Company.

TescoCars.com will provide consumers with a convenient, easy and safe alternative to buying cars from traditional used car forecourts, with significant savings on forecourt prices due to the low overhead business model. The website lists thousands of used cars that drivers can search by budget, space or performance preferences. The vehicles are predominantly ex-fleet cars that only have one previous owner and they are all quality checked and pass a 167-point RAC safety test and can be picked up either at a central handover centre or delivered directly to the customers home address.

Douglas Rotberg, the co-founder of Carsite, said "Cavendish Corporate Finance have been invaluable to us over the last few years, helping us not only with our fundraising needs but also in providing crucial input into our business to ensure we are well positioned to execute our business plan. The deal with Tesco provides us with the perfect partner to enable us to become a leading player in the used car market, saving the consumer money and providing better returns for our lease and fleet company partners."

Simon Ramery, the Partner who led the transaction, said "Carsite have been working on re-defining car retailing for a number of years, and now with Tesco as a partner, have a fantastic opportunity to make this a reality and become a leading player in the £24bn motor market. Overall it has been a pleasure working with the Carsite team and help create what will hopefully become a significant player in the market."