DALLAS – A Dallas venture that had aimed to build a national network of used-car lots has filed for Chapter 11 bankruptcy protection, just 15 months after embarking on that strategy, according to the Dallas Business Journal. Manchester Inc. was seeking to create a national network of buy-here, pay-here auto lots — essentially the subprime realm of car dealers.
The company was able to line up more than $100 million in debt and had announced deals to buy at least eight auto dealers. Whether it consummated all those deals is unclear, but Manchester claimed in an October court filing that it was duped into paying too much for its first acquisition by a Chattanooga, Tenn.-area used-car dealer.
Manchester said it paid $75 million for Nice Cars Inc. in 2006, but the company owner and others schemed to present a too-rosy financial picture of the operation, according to a Manchester lawsuit filed at the end of November.