Moody’s Investors Service on Tuesday cut its rating for Farefetch’s debt to Caa2, deep in junk territory, and put the luxury marketplace on review for another downgrade.

The credit rating firm cited Farfetch’s deteriorating financial position and grim prospects. Farfetch cancelled its planned earnings results on Nov. 28, after The Telegraph reported that the company’s chief executive José Neves was in talks with  top shareholders, including Alibaba and Richemont, and JP Morgan to take the company private, a move Moody’s attributes to Farfetch’s dwindling cash flow. Farfetch’s share price has fallen to less than $1, a potential hurdle for the company to raise money to keep operating. (Farfetch traded at more than $70 at its peak in 2021). A broader luxury e-commerce slowdown also means the e-tailer likely won’t reach its sales targets for this year.

Moody’s downgrade comes as Farfetch explores options amid its worsening cash position, including tapping existing partners for new investments and selling off assets like its brand incubator New Guards Group, BoF previously reported.

But Farfetch’s ability to secure capital from existing investors remains unclear. Richemont, which invested $1.1 billion in Farfetch in 2020 in partnership with Chinese e-commerce giant Alibaba, has said it does not plan to invest further in Farfetch. A deal to sell a 47.5 percent stake in Richemont’s e-tailer Yoox Net-a-Porter to Farfetch appears to have stalled. Alibaba’s president J. Michael Evans departed Faretch’s board on Nov. 30, inciting more uncertainty about Farfetch’s relationship with Alibaba. The two companies have been in a joint venture in China since 2020.

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Farfetch Seeks ‘White Knight’ to Avert Collapse, Sources Say

The e-commerce giant is seeking a cash injection to avert a collapse that could send shockwaves across the fashion industry. So far nobody has come to the table and time is running out, but founder José Neves may yet have a move up his sleeve.