Cazoo has retreated from Europe, closed two-thirds of its UK handover centres, reduced its transporter fleet by 20%, and cut hundreds of jobs. Credit: Slidewarrior/Shutterstock.

UK-based online used car retailer Cazoo is actively exploring strategic options amid a deepening funding crisis, reported The Telegraph citing undisclosed sources.   

The company is seeking shareholder support for an urgent cash injection while preparing for potential contingency measures.  

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According to a source, all options are being considered, including attracting new investors, a possible sale or splitting the company, and asset sales. 

Should the search for fresh funds fail, Cazoo may have to consider administration.  

The company has engaged a team of restructuring and insolvency experts to help navigate the crisis.  

In December 2023, Cazoo disclosed that it might deplete its capital by mid-year 2024, facing a critical situation after years of substantial losses and a downturn in the second-hand car market. 

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Founded by Alex Chesterman, the company was listed on the New York Stock Exchange in 2021 and has since experienced multiple setbacks.  

In December, despite significant cost reductions, the company underwent a debt-for-equity swap that secured its future but resulted in considerable losses for shareholders. 

Shortly after, Cazoo announced a cash shortfall, warning of potential insolvency in the first half of 2024 without additional capital.  

In a US SEC filing, Cazoo said: “If we are unable to obtain adequate financing…our ability to continue as a going concern…could be significantly limited, and this could have a material adverse effect on our business, financial condition, results of operations and prospects.” 

Cazoo has retreated from Europe, closed two-thirds of its UK handover centres, reduced its transporter fleet by 20%, and cut hundreds of jobs.  

In a statement, a Cazoo representative said: “Cazoo does not comment on market rumours but…as we have made clear in our SEC filings, we have commenced an evaluation of potential partnerships, synergies, mergers, acquisitions, joint ventures and sales in the light of our improved capital structure.”