A High Court judge has allowed Thames Water to undergo a major restructuring which will see them borrow £3 billion pounds from major creditors.
The move was green-lit in a judgment handed down on Tuesday morning, after four days of arguments. The company currently holds £19 billion of debt, having previously said that they could run out of money by March 24th if they failed to secure further funding.
Had the loan not been approved, Thames Water could have been placed under a temporary nationalisation to keep its core services in operation.
Thames Water will receive two loans of £1.5 billion each, which will see interest rates of 9.75% – opening the door for further hikes in customer bills. The first loan round secures funding for the company through September.
They remain in a precarious financial situation, having recently been told by Ofwat that they could raise bills by 35% over the next five years, lower than the 53% they had originally sought.
The government remain on standby to intervene should their finances collapse further.
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HeadlineHigh Court approves £3 billion Thames Water loan
Short HeadlineThames Water loan approved in Court
StandfirstThe company has been allowed a restructuring just weeks before it was set to run out of money.
A High Court judge has allowed Thames Water to undergo a major restructuring which will see them borrow £3 billion pounds from major creditors.
The move was green-lit in a judgment handed down on Tuesday morning, after four days of arguments. The company currently holds £19 billion of debt, having previously said that they could run out of money by March 24th if they failed to secure further funding.
Had the loan not been approved, Thames Water could have been placed under a temporary nationalisation to keep its core services in operation.
Thames Water will receive two loans of £1.5 billion each, which will see interest rates of 9.75% – opening the door for further hikes in customer bills. The first loan round secures funding for the company through September.
They remain in a precarious financial situation, having recently been told by Ofwat that they could raise bills by 35% over the next five years, lower than the 53% they had originally sought.
The government remain on standby to intervene should their finances collapse further.
