By Sohaib Shams
Thames Water creditors are voting on Thursday on an emergency £2.4bn loan to keep the debt-laden utility operating until autumn 2027, as the company warns it could run out of cash by the end of 2026 or early 2027.
Creditors Prepare Emergency Funding
A consortium known as London & Valley Water, which includes class A creditors BlackRock, Elliott Management and Silver Point Capital, will decide whether to increase a funding facility to £5.4bn. The same group granted a £3bn loan at 9.75% interest last year, of which Thames Water has drawn £2.65bn so far.
Campaigners Warn of Bill Increases
Analysis by the campaign group We Own It estimates the new loan, if added to customer bills on the same terms, would cost £40 per household in interest alone and £454 if the full amount were passed through. London & Valley Water insists the costs will not be added to bills and will be borne entirely by creditors.
Political Pressure for Public Control
Mayor of Greater Manchester Andy Burnham is weighing whether to approve a creditor-led takeover that would write off fines and reduce environmental commitments, or to pursue nationalisation or another form of state control. Labour politicians and environmental campaigners, including Liberal Democrat MP Charlie Maynard, have urged Burnham to place Thames Water into special administration, a temporary government control while a new buyer is sought.
Company and Creditors Reject Cost Pass-Through
Thames Water serves 16 million customers in London and the Thames Valley and carries a debt pile of about £20bn. Its shareholders exited in 2024, leaving creditors in effective control. Economist Prof Dieter Helm doubts a turnaround can be properly funded and sees special administration as inevitable. Both Thames Water and the creditor consortium maintain that rescue financing will not increase household bills, which are set by regulator Ofwat.
