Cazoo Group Ltd - Restructuring Agreement - News

Cazoo Announces Restructuring Agreement with Noteholders to Materially Reduce its Debt and Improve its Capital Structure

20 SEPTEMBER 2023

Full announcement including full disclosures and disclaimers available via Cazoo Group Limited

"Noteholders signal continued support for Cazoo

Debt reduction provides enhanced financial flexibility to support future growth

• $630 million of Convertible Notes to be cancelled in exchange for $200 million of new senior secured debt and new equity

• Debt maturity profile remains unchanged, but level of debt is significantly reduced

• New warrants to be issued to existing shareholders, subject to future performance

LONDON & NEW YORK--(BUSINESS WIRE)-- Cazoo Group Ltd (NYSE: CZOO) (“Cazoo” or “the Company”), the UK’s leading independent online car retailer, which makes buying and selling a car as simple as ordering any other product online, announces that the Company has entered into a transaction support agreement (the “Agreement”) with certain noteholders (the “Noteholders”) representing more than 75% of its $630 million aggregate principal amount of 2.00% Convertible Senior Notes due 2027 (the “Convertible Notes”) and shareholders representing more than 25% of our outstanding shares. The transactions and actions proposed by the Agreement (the “Transactions”) will significantly deleverage the Company’s capital structure and are expected to improve the Company’s financial flexibility. The Company expects the Transactions to close in the fourth quarter of 2023.

Rationale for the Transactions

It is the view of the board of directors of Cazoo (the “Board”) that the material debt reduction offered by the Transactions is beneficial to the Company’s future. Cazoo’s current capital structure weighs on the Company’s equity notwithstanding its strong cash balance and recent progress towards its goal of profitable growth. Deleveraging will reduce the Company’s current debt overhang, is expected to improve the Company’s financial flexibility to support its return to growth, should improve the Company’s ability to meet the NYSE continued listing standards and should facilitate progress on various strategic options. While the Transactions will dilute existing Cazoo shareholders, the Transactions provide for potential future upside through the equity retained by existing shareholders and the issuance of new warrants to existing shareholders."

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