Thames Water Lenders Plan £1B Lifeline This Year, Times Reports

(Bloomberg) -- Thames Water creditors are planning to inject more than £1 billion ($1.33 billion) into the utility before the end of the year to help to get its finances in order, The Times reported, citing sources it didn’t identify.

Hedge funds and institutions holding about £10 billion of Thames Water debt say it needs an infusion of cash to stabilize it and pave the way for a full restructuring, which may take until June 2025. Thames has said it has enough cash to last until May.

The funds are most likely to be loans or bonds with “super senior status”, meaning that the lenders would be first to be repaid if the company failed. It might also give them more say in how the restructuring occurs.

It may take two to three months to secure the funding and is expected to fill the £1.25 billion gap left by its owners, the report said. Elliott Investment Management and Blackrock may be among potential creditors.

It would be a precursor to a sweeping restructuring that could see the firm raise funds from new investors and potentially convert some of its debt into equity. Thames Water declined to comment to the newspaper.

©2024 Bloomberg L.P.