Thames Water running out of time to secure rescue as debt swells
Time is running out to strike a rescue deal as Thames Water’s debt reaches almost £20bn.
Britain’s largest water and waste company returns to profit after rising customer bills inside April.
The company has enough power The cash will last until the beginning of next year, but could fall into government-controlled administration if a deal is not approved.
A. Controversial restructuring plan The proposal from a group of lenders is still being discussed intensively with regulator Ofwat and the Department for the Environment.
Thames has the option of asking its creditors for another urgent cash injection, valid through 2026, but they will only agree to this if a rescue deal is approved.
The company has faced heavy criticism for trying to fix leaks, stop sewer leaks and modernize outdated infrastructure.
Water services will continue as normal no matter what happens to the Thames or who owns the company.
The company warned in its half-year results that there was still “material uncertainty” about whether the deal would be achieved.
The government has already chosen administrators who will step in if necessary.
Deal proposed by London & Valley Water consortium of Thames’ main creditors, They would see them pump investment into the public service and write off debt in return for softer performance targets.
Them Write off a quarter of the money they owe, while a smaller group of junior lenders have their loans erased entirely.
The BBC understands the group is hopeful its plans will be agreed in principle before the end of the year.
But the plan has many criticisms of the proposed proposal tolerance Fines for pollution and spillage.
London and Valley Water He insists that allowing the Thames to fall into administration would leave it in limbo and make many of its problems worse.
Customer complaints have almost doubled since last year, with the majority relating to bill increases.
Thames increased its bills by 40% in April. It increased the number of customers on social tariffs financed by other customers’ bills.
Chris Weston, Thames Water’s chief executive, said in the company’s half-year results that “bill increases have been significant this year and I recognize the difficulties this has created for many people.”
“A market-driven solution clearly remains the best option for our customers, the environment, taxpayers and the economy,” he said.
It was said in July He said it would take at least a decade for the company to bounce back.
In May, it was fined £122.7 million, the largest ever imposed, by water industry regulator Ofwat for breaches of rules on sewer leaks and payments to shareholders.
