Online used-car seller Cazoo Holdings Ltd said on Monday it plans to go public through a merger with a blank check company Ajax I (AJAX) in a deal that values the combined company at $7 billion.

What Happened: The deal includes up to $805 million Ajax cash in trust and the company expects to raise about $800 million through private investment in public equity at $10.00 per share, Cazoo said in a statement.

The deal will deliver about $1.0 billion in gross cash proceeds to the combined company. Cazoo said it would use the proceeds to further build out its brand and infrastructure. Cazoo’s existing shareholders will hold about 79% of the shares of the combined company on the closing of the deal.

The board of directors at both companies have approved the deal but it still needs the shareholders' nod. 

The deal is expected to close in the third quarter of 2021. Upon closing, the combined company will be named Cazoo and will be listed on the New York Stock Exchange under the symbol “CZOO.”

Why It Matters: Cazoo buys and restores cars and then sells them online and finally delivers them to customer’s homes. It was founded in 2018 and has delivered over 20,000 cars to consumers across the United Kingdom. Following its recent acquisitions, Cazoo is also now Europe’s leading car subscription player with over 6,000 subscribers across the U.K., Germany, and France.

Ajax is an $805 million special purpose acquisition company, founded by billionaire investor Daniel Och in partnership with Glenn Fuhrman and a team of strategic advisors including the founders of Chipotle Mexican Grill (CMG), Facebook Inc. (FB) Instagram, Square Inc (SQ), and 23andMe. 

Och will join the combined company’s Board of Directors.

A SPAC is a shell company that raises funds in an IPO with the aim of acquiring a private company, which then becomes public as a result of the merger.

Online car sales have picked up with most retailers seeing customers opt for the non-touch route to complete the purchases from the comfort of their homes. 

Price Action: Shares of Ajax I closed 0.59% higher at $10.25 on Friday.