Thames Water is in talks to secure additional funding after the company reported £14bn debt
News broke of Thames Water’s crippling debt just one day after chief executive Sarah Bentley stepped down from her position with immediate effect.
12 months ago, shareholders promised a £500m equity injection to Thames Water, and pledged a further £1bn subject to conditions.
£500m was received in March, but the additional £1bn has never been paid.
On Wednesday, the government said it was ready to act in a ‘worst case scenario’ if Thames Water does collapse.
In a recent statement, Ofwat said: “Over the last day or so, there has been a lot of commentary about financial resilience in the water sector with considerable focus on Thames Water in particular.
“We have been clear that Thames Water has significant issues to address – their environmental record and leakage performance, for example, are poor. Alongside the turnaround of their operational performance, they need to improve their financial resilience too.
“But that is all in the context of a company that has strong liquidity – it recently received an additional £500m from shareholders and has £4.4bn of cash and committed funding.
“Overall, the sector is continuing to attract international capital and is especially attractive to long term investors such as pension funds. Indeed, there has been an additional equity injection of around £2bn since 2020, with companies acting to strengthen their financial position.”
