Addison Lee’s lenders plan to take control of struggling cab firm
Addison Lee’s banks are set to take control to fend off the threat of an administration.
A sale of the taxi operator has ground to a halt because of debts of more than £250m.
The Telegraph reported that the firm is looking to finalise a deal with a group of at least eight lenders to avoid collapse.
The US private equity firm Carlyle bought Addison Lee for £300m in 2013 and put it up for sale last year.
Despite a flurry of initial interest there has been little progress in a sale of the firm because of its sizeable debts.
Private equity firm Cerberus Capital Management is reported to have submitted a bid for the company last month. It is unclear how formal the proposal was.
Some bids for Addison Lee are understood to have been as low as £40m which would have forced the firm’s lenders to book millions in losses.
Valuations had been as high as £800m but fierce competition from ride-hailing apps like Uber, and a patchy performance from Addison Lee’s US business have contributed to substantial losses.
Carlyle could be wiped out as lenders agree to refinance some of the loans in return for shares in the business, according to The Telegraph.
In December, Addison Lee’s former chief executive Liam Griffin approached investment funds to support his £125m takeover of the firm.
Griffin, who is the son of the taxi operator’s founder John Griffin, stepped down as chief executive of the company in 2015 but remained on the board as vice-chairman.
The Telegraph’s sources said the firm has not ruled out a last minute deal but huge loans and a challenging market have put suitors off.
A source with knowledge of the situation told City PM that a process was ongoing with Rothschild advising.
Addison Lee was founded by John Griffin in 1975. It has since expanded to operate in more than 80 countries.