Britain's largest water supplier Thames Water remains locked in rescue talks with creditors as the debt-laden company warns of "material uncertainty" surrounding a deal to avert potential nationalisation. The company serves around 16 million customers and carries nearly £20 billion in debt.
Thames Water reported half-year underlying earnings of £1.2 billion to September 30, up sharply from £715.1 million a year earlier. Revenue surged 42 percent, driven primarily by bill increases implemented in April. But the hikes triggered a backlash: customer complaints soared by three-quarters to 55,158 in the half-year period.
The proposed rescue involves the London & Valley Water consortium, a group of Thames Water's main creditors including Aberdeen, Elliott Management, and Silverpoint Capital. They have submitted plans offering investment and debt write-off in exchange for more lenient performance targets.
Thames Water stated that discussions with the consortium, regulators and government are "positive" but acknowledged: «Since the proposal was made, positive discussions are ongoing between the consortium, the regulators and Government, albeit there remain a number of items to be negotiated and agreed before a recapitalisation can proceed.»
Previous rescue collapsed
The urgency is heightened by the collapse of a previous rescue deal in May involving US private equity giant KKR, which left Thames Water on the brink of collapse. Without a successful agreement, the company risks being placed into the government's special administration regime.
Thames Water invested £1.3 billion in capital during the period, funded by the bill increases. The company said the spending went toward fixing leaks, reducing sewage spills, and improving water quality, contributing to a fifth reduction in pollution spills.
Chief executive Chris Weston emphasized the company's commitment to securing a market-led solution: «We continue to work closely with stakeholders to secure a market-led solution that we believe is in the best interests of our customers and the environment. This in turn will allow the transformation of Thames to continue, a programme that will take at least a decade to complete and will restore the infrastructure and operations of the company.»
Note: This article was created with Artificial Intelligence (AI).
