Remember the £190m interest bill Thames Water wanted more time on? It’s due next month
The embattled firm will learn from Ofwat in the next few months whether it will be allowed to charge customers more to fund its recovery plan
Another headache has emerged for the owners of Thames Water. It has been reported that some of its major creditors have engaged EY to advise them on their options ahead of a £190m interest payment, which is due next month.
According to Sky News, the financiers have commissioned the Big Four firm because they are concerned about Kemble Water Holdings’ ability to pay the bill next month.
In December, Kemble’s then-chairman, Sir Adrian Montague CBE, who has since resigned, told a hearing of the Environment, Food and Rural Affairs committee that the company was struggling to pay off its £18bn debt pile because its bills were too low.
“I think we would say that some of the problems that we are now encountering were because bills were kept deliberately very low over the past period,” Sir Adrian said at the time.
At the time, Kemble was seeking an extension to the due date of the £190m tab.
Before 2025, the company is looking to receive £750m from shareholders; a crew of international pension funds spanning Canada, Australia, China and the UAE among others.
In May, water industry regulator Ofwat will also decide if the firm can claim an additional £2.5bn from shareholders between 2025 and 2030 to finance its £18.7bn investment plan for the 2025-2030 period.
Earlier this year, the government moved quietly to try and shore up any potential bailout it may have to provide the water firm as its stability continues to be in major doubt.
This extends to day-to-day operations, with sewage discharge from storm overflows still occurring regularly.
According to Thames Water’s live sewage discharge monitoring tool, sewage has been pumping into the River Thames at four locations between Pimlico and North Greenwich for between three and 41 hours in the last two days.
Last month, the embattled firm pushed up its leakage forecasts for this year from 550m litres a day to 585m and between 512m and 530m litres next year – up from the 507m previously forecast.
EY and Kemble Holdings have been contacted for comment.
