Financially Rescued: The UK’s Biggest Water Provider Receives Assistance
According to recent reports, the company, which was previously under the threat of being taken back into public ownership, has announced that its shareholders have unanimously approved an additional financial injection of £750 million ($960 million).
London-based Thames Water revealed on Monday that it has secured a substantial financial infusion from its shareholders, ensuring the sustainability of the largest water supplier in Britain.
Prior to the recent development, the company was reportedly facing the possibility of being taken over by the government, but it has now announced that its shareholders have consented to supplying an additional £750 million ($960 million) in funding.
Nevertheless, the current funding falls below the company’s initial target of £1 billion, in addition to the £500 million previously obtained from shareholders in March.
In a statement released on Monday, Thames Water also acknowledged that it would require an additional £2.5 billion of assistance between the years 2025 and 2030.
Ian Marchant, the chairman of Thames Water, commented that the recently announced supplementary investment represents the largest equity support package ever witnessed in the UK water industry. This substantial financial commitment from the shareholders further emphasizes their dedication to facilitating the transformation and recovery of Thames Water.
Ontario Municipal, a Canadian pension fund, holds the largest stake in the company, accounting for nearly one-third of the group’s ownership.
With a customer base encompassing 15 million residences and businesses in London and various areas across southern England, Thames Water currently carries a debt load of approximately £14 billion.
Last month, Sarah Bentley stepped down from her position as chief executive. As of now, the utility company has not yet appointed a permanent successor to fill the role.
Compounding its challenges, Thames Water was recently subjected to a fine of £3.3 million by a UK court for contaminating rivers.
In 2017, Thames Water admitted guilt in the act of discharging millions of liters of untreated sewage directly into rivers near Gatwick Airport in London, resulting in the loss of wildlife.
Recently, privatized water companies in Britain made a significant commitment to undertake substantial investments aimed at preventing the discharge of untreated sewage into water bodies.
According to reports, there are concerns over water quality and weaker environmental protections following Brexit, which may result in water bills increasing by 40 percent by 2030 to finance the necessary improvements.
