Cazoo, the British online car retailer once-valued at well over £5bn, will crash into administration on Tuesday.

Sky News understands that insolvency practitioners from Teneo will be formally appointed just over a week after Cazoo filed to seek temporary protection from creditors.

More than 700 people have already lost their jobs as a result of the crisis at Cazoo, with the administrators expected to retain a number of staff to operate the remaining marketplace model while they explore a sale.

Motor industry sources said the entry into administration would allow Teneo to focus on a sale, with the marketplace model having drawn interest from a number of potential suitors.

On Monday, the group’s wholesale arm was sold to G3, another industry player, with Constellation Automotive, the owner of Cazoo’s rival, Cinch, also having acquired a number of assets from the stricken New York-listed company.

One industry source said that among the parties potentially interested in Cazoo’s marketplace, including its brand, were BMW, Motorpoint and Car Gurus.

Motors.co.uk, a privately owned used-car platform, also remains among the field of prospective buyers.

South West Water: Surge in profits for parent company of utility responsible for fixing contaminated supply in Devon

Grocery inflation at lowest level since October 2021, industry data suggests

‘We’ve got to fight for our livelihoods’: Port Talbot’s uncertain future as the cost of going green hits home

Cazoo was founded in 2018 by Alex Chesterman, the successful entrepreneur behind Zoopla, the property portal.

It raised several tranches of funding at ever-higher valuations before making its stock exchange debut in 2021, when investors ascribed a valuation of $8bn to it.

Cazoo spent tens of millions of pounds on sponsorship deals in football, snooker and darts in a rapid attempt to gain market share.

Among the assets which have been sold in recent weeks include its vehicle fleet, which sources said had been achieved at higher-than-anticipated values, reflecting a current shortage of used cars in the market.

One industry source said the pivot to a platform model had seen its inventory rise to more than 15,000 cars, with Cazoo now the only online vehicle marketplace where consumers can buy and sell cars under a single brand.

Mr Chesterman left the business several months ago in the wake of a balance sheet restructuring which saw hundreds of millions of dollars of debt converted to equity.

The entry into administration comes after a further wave of restructuring of its balance sheet and operations.

Cazoo declined to comment on Tuesday but had said last week: “Our new marketplace model, where consumers can both buy and sell cars, is revenue generating and performing ahead of expectations with interest from almost 100 car dealers including many household names wishing to trade on the Cazoo platform.”

The company added that it had “successfully restructured and significantly reduced the cash burn of the group”.

Be the first to get Breaking News

Install the Sky News app for free

Teneo declined to comment.

Related posts:

Morrisons extends 10% discount for NHS staff amid pay row for nurses PM Johnson to host bosses for talks amid ‘pingdemic’ anger Sunak faces calls to cut VAT on fuel as retailers defend ‘necessary’ pump price hikes Putin ally and boss of Russian oil giant has £86m yacht seized in France China protest, Cyber Monday and diamonds Energy crisis prompts desperate search for nuclear workers in France Bitcoin hits 18-month price high amid trade fund speculation Sir Jim Ratcliffe completes purchase of Manchester United stake – seizing control of football operations from Glazers Banknotes featuring the King to be issued for first time Borrowing, Heathrow and business optimism The Post Office scandal – more trouble on the Horizon? Japan calls time on era of massive stimulus after long search for inflation