Thames Water, the UK’s largest water provider with 16 million customers, is facing a significant financial showdown as it works to avoid potential insolvency and nationalisation.
The utility company is currently deciding between two competing financing proposals, both aiming to provide critical funds to support its operations and debt obligations.
The latest offer, submitted by the company’s class B bondholders, led by BlackRock and organised by DC Advisory, proposes a £3 billion package.
This offer claims to provide double the capital at a lower cost than an alternative proposal from class A bondholders, which includes hedge funds like Silverpoint and Elliott Advisors.
The class B group’s plan is said to save Thames Water hundreds of millions in interest and fees over the coming year due to its more favourable terms, including an 8% interest rate.
In contrast, Thames Water had previously shown public support for the class A group’s more costly proposal.
This funding struggle is happening as Thames Water deals with operational and regulatory pressures, including fines related to poor performance on sewage management.
The company is also conducting a separate equity-raising process with Rothschild, where U.S. investment firm KKR has shown interest.
Any decision on the financing could bring further scrutiny to executive compensation, as government officials and the regulator Ofwat are closely monitoring the company’s financial and operational stability.
Source:
sky news
