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Carbiz Inc. has ceased operations.
Less than a month after defaulting on its lines of credit with Dealer Services Corp. (DSC) and Wells Fargo Preferred Capital Inc., the Sarasota, Fla., buy-here, pay-here chain closed all 25 of its stores.It also shut down its consulting and collections services.
“We were unable to find another line of credit,” said Carl Ritter, CEO of Carbiz. "This is not the message I was hoping to deliver.”
The company operated stores in Indiana, Illinois, Oklahoma, Florida, Iowa, Nebraska, Ohio, Kentucky and Texas.
After losing its access to capital last month, Ritter said the company would unlikely be able to continue operating unless another line of credit could be found.
On Feb. 11, the company’s Web site, Carbiz.com, was no longer operable.
Calls to Carbiz’ corporate offices went to voicemail, as did calls to several of its stores.
However, employees at the company’s Houston store were able to say that Southern Auto Finance Company (SAFCO), a Ft. Lauderdale, Fla., portfolio services provider, will be handling collection duties from this point on.
These events come nearly a year after Carbiz had its line of credit purchased and restructured by DSC following the bankruptcy of its previous lender, Illinois-based SWC Services LLC.
According to SEC filings, Carbiz owed DSC $16.42 million and Wells Fargo $12.19 million when the default notices were issued.
Troubles began in August when Carbiz was unable to make its monthly curtail payment to DSC. The monthly deferment charge was $350,000.
DSC immediately ceased funding new inventory. Representatives from DSC did not respond for comment. |
