Category Archives: Thames Water

Thames Water credit ratings slashed to lower levels of junk as default fears grow

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S&P and Moody’s cut ratings by five notches on risk troubled company will run out of cash

Thames Water’s debt rating has been slashed to the lower levels of junk by two major credit rating agencies, piling further pressure on the UK’s biggest water company, which is rapidly running through cash and fighting to stave off renationalisation.

S&P Global Ratings and Moody’s said the utility was fast running out of money and on the brink of default. S&P cut its rating on Thames’s £15bn top-ranking debt pile by five notches to CCC+, taking it into the triple-C category that is considered very risky. Thames lost its investment-grade credit rating in July.

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Thames Water lobbied Whitehall to press Ofwat on allowing higher bills

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Exclusive: Debt-ridden company also warned officials of ‘chilling effect’ of any renationalisation

Thames Water has lobbied the government to intervene with the regulator to allow it to charge far higher bills, the Guardian can reveal.

Advisers and board members of the beleaguered water company are understood to have met Whitehall officials in recent weeks to say that allowing it to be temporarily renationalised would have a “chilling effect” on the entire UK’s appeal to international investors, sources familiar with the discussions told the Guardian.

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Thames Water says without steep bill increase it’s ‘neither financeable nor investible’

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Debt-laden company tells Ofwat if it cannot charge customers 59% more, it ‘would prevent company turnaround and recovery’

Thames Water has said it will be unable to recover from its funding crisis if it is blocked from charging customers significantly more, as it proposed to pile an extra £228 a year on to household bills.

The debt-laden company said the increase to bills that has been proposed by the industry regulator, Ofwat, leaves its activities “neither financeable nor investible”.

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Canadian export agency ‘hit by big losses after lending to Thames Water’

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State-backed body EDC has reportedly sold at deep discount two loans made to debt-ridden UK utility

Canada’s state-backed export credit agency is reportedly nursing steep losses after lending debt-ridden Thames Water hundreds of millions of pounds.

The British utility, which has said it could run out of cash by next June, received two loans from Export Development Canada (EDC) in 2018 and 2019 at the behest of the Canadian pension fund Omers.

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UK rivers and beaches have been heaped with pollution for years – when will we talk about restoration?

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The penalties reflect the failings of the Environment Agency and Ofwat as much as the water companies

Behind the record fines announced by Ofwat for the routine dumping of sewage into rivers and seas by three water companies, there is a voiceless victim, one that does not sit in boardrooms, or get a chance to count dividends. It is our rivers and coastal waters, subjected to years of continuous pollution under the noses of the regulators, which are suffering.

In all likelihood the £168m penalties for the already struggling Thames Water, Yorkshire Water and Northumbrian Water will be followed by fines for the remaining eight water and sewerage companies, all of whom Ofwat is investigating over failure to treat sewage according to the law.

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Thames Water owner to liquidate solar energy subsidiary amid debt crisis

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Exclusive: solar developer Trinzic to voluntarily shut down as holding company seeks to recoup more than £25m

A solar energy project developer linked to Thames Water is to be liquidated and its staff made redundant as the crisis engulfing the debt-laden water supplier puts strain on its complex corporate structure.

Trinzic Operations Ltd, which is ultimately owned by Thames’s parent company Kemble Water Holdings, is to be voluntarily shut down, the Guardian can reveal.

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Revealed: the ‘catastrophic scale’ of sewage spills in England and Wales

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Water companies have logged five sewage spills a day, every day, for a decade, analysis by the Observer shows

Water companies in England and Wales have averaged five serious sewage spills into rivers or seas every day over the past decade, the Observer can reveal.

Analysis of Environment Agency data has found that the 10 firms recorded 19,484 category 1-3 pollution incidents between 2013 and 2022, the most recent year recorded, an average of one every four and a half hours.

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Thames Water collapse could trigger Truss-style borrowing crisis, Whitehall officials fear

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Exclusive: Concerns over effect on UK’s finances lead officials to believe utility should be renationalised before general election

Senior Whitehall officials fear Thames Water’s financial collapse could trigger a rise in government borrowing costs not seen since the chaos of the Liz Truss mini-budget, the Guardian can reveal.

Such is their concern about the impact on wider borrowing costs for the UK, even beyond utilities and infrastructure, that they believe Thames should be renationalised before the general election.

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Thames Water could raise bills to £627 a year to help fix leaks

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Embattled water supplier promises to invest up to £3bn more over the next five years

Thames Water could raise bills to as much as £627 a year to pay to fix its leaky network, after promising to invest up to £3bn more over the next five years.

The embattled water supplier said on Monday that it had updated its spending plans for 2025 to 2030 after discussions with the industry regulator, Ofwat.

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Thames Water-linked firm paid £14m in dividends despite concerns over group

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Kennet Properties sells off Thames Water land, whose owner, Kemble Water, has warned it would not be able to pay a £190m loan

A development company that sells off land no longer needed by Thames Water has paid out a £14m dividend despite warnings that it could become engulfed by the embattled water group’s financial woes.

Accounts filed at Companies House show Kennet Properties paid out a £14.5m dividend during the year to 31 March 2023, despite the difficulties faced by the wider group, which is facing a potential administration.

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Australia’s Macquarie among lenders to Thames Water’s parent company

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Controversial investment bank could play important role in fate of Britain’s biggest water firm

The Australian investment bank Macquarie, which has been criticised for its role in the privatisation of England’s water industry, is understood be among lenders to Thames Water’s troubled parent company.

The former Thames Water shareholder could, along with other lenders, play an important role in determining the fate of Britain’s biggest water company, after its parent company Kemble Water Finance defaulted on its debt.

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Thames Water owner bond slumps to record lows amid uncertainty over firm

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Fall to 14.4p comes after shareholders said they were unwilling to inject further funds

A bond issued by Thames Water’s parent company has fallen to record lows as the embattled company scrambles to secure its future, and the government signalled it is “ready to step in if necessary”.

The £400m bond, issued by the water supplier’s parent company, Kemble, has slumped to only 14.4p after shareholders indicated that they were unwilling to inject further funds into the heavily indebted utility company.

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Thames Water hires restructuring advisers amid fears of collapse

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Crunch talks expected after investors refuse to secure short-term cashflow and parent company due to repay £190m loan

Thames Water has assembled a team of City experts to lead urgent restructuring talks this week amid fears that its parent company may collapse by the end of the month.

The crunch talks are expected to take place days after Thames Water’s investors signalled they would not put further funds into the company to secure its short-term cashflow, according to a source.

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Fresh crisis for Thames Water as investors pull plug on £500m of funding

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Decision raises concerns about financial future of UK’s biggest water firm and increases prospect of nationalisation

Investors at Thames Water have pulled the plug on £500m of emergency funding, raising concerns about the financial future of the country’s largest water company and increasing the prospect of nationalisation.

The beleaguered utilities company announced this morning that its shareholders had refused to provide the first tranche of £750m funding set to secure its short-term cashflow, after the company had failed to meet certain conditions.

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‘I’ve seen solid waste float by’: Surrey riverside residents try to Stop the Poo

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The sewage treatment works at Horley seem to be crumbling, much like owner Thames Water itself

The brochure boasts of a family-friendly community located in tranquil green space within easy reach of high-speed links to London.

However, the residents of a new development of 1,500 homes in Horley, Surrey, have recently set up a WhatsApp group, whose title illustrates a less attractive feature of the community: Stop the Poo.

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Come clean on secret taxpayer rescue plans for Thames Water, MP demands

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Exclusive: Sarah Olney to press in parliament for details of scheme being drawn up in event of supplier’s collapse

Ministers must come clean on the secret details of an emergency plan for a taxpayer bailout in the event of Thames Water collapsing, a Liberal Democrat MP has said.

Sarah Olney will press in parliament this week for details of a behind-the-scenes rescue operation being drawn up for the biggest privatised water company in England. Olney said keeping the details of the contingency plan secret amounted to a cover-up.

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Thames Water absent from industry’s £180m anti-pollution drive

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Ministers disappointed by decision of one of worst sewage dumpers not to join England-wide initiative

Thames Water has risked a fresh backlash over its commitment to tackling sewage dumping after it declined to commit funds to a £180m industry-wide initiative to fast-track efforts to reduce pollution in England’s waterways.

The government said on Monday that the sum would be spent by six companies over the next 12 months to prevent more than 8,000 sewage spills, as water companies attempt to address their woeful record on tackling spills.

However, Britain’s biggest water company, which has a £14bn debt mountain, has not taken part in the drive and it is understood that government officials are disappointed in its refusal to do so.

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Thames Water bypassing local opposition in attempt to launch water recycling project

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Company faced public backlash over scheme, which campaigners say threatens to increase river pollution

Thames Water is bypassing local democracy to attempt to push through a controversial water recycling project that campaigners say threatens to increase pollution in the river.

Steve Barclay, the secretary of state for environment, food and rural affairs, has agreed to an application by the water company to consider its Teddington water recycling scheme under national infrastructure rules. The decision means local authorities will be bypassed, and the secretary of state will make the decision whether to grant a development consent order.

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Conservative ‘failures’ have led to more sewage pollution, say water experts

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Increased flooding blamed on years of government delays over ‘sponge cities’ rules

Increased sewage pollution, urban flooding and water supply interruptions are the result of a decade of failures by the Conservative ministers, according to water experts who are demanding an independent inquiry into water be set up by the next government.

The repeated failure of the Tories to implement rules to create “sponge cities” has led to much more visible sewage pollution, more flooding and increasing instances of water being cut off for householders and businesses, they say.

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Thames Water’s owners only have themselves to blame for the write-downs | Nils Pratley

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It looks as if USS simply overpaid and underestimated the effort and catch-up investment required

“We continue to view Thames Water as a long-term investment,” said the Universities Superannuation Scheme (USS), the £75bn pension fund for UK academics, as it wrote down the value of its stake in the Thames’ parent by nearly two-thirds, or almost £600m. Top marks for cheerfulness, but it’s a line that recalls the old joke about the definition of a long-term investment: a short-term investment gone wrong.

USS and Canadian pension fund Omers, the other late arrival on Thames’ register in 2017 (they replaced the departing Macquarie and its co-travellers), surely cannot have imagined that the long term would stretch quite so far over the horizon. As USS says, it’s taken no dividends so far, and the current business plan imagines no income for shareholders until 2030 at the earliest. That’s a near-eternity in investment terms for utility assets, which are supposedly prized for their ability to generate steady cash.

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