Thames Water Seeks $1.34B Lifeline Amid Debt Crisis

Thames Water seeks a £1 billion ($1.34 billion) lifeline to restructure £16 billion debt and avoid administration. The company's ongoing talks with creditors aim to secure interim liquidity. Failure to agree on a rescue plan could lead to a special administration regime, impacting 16 million people and investor confidence.

Thames Water is actively engaged in negotiations with some of its creditors to secure a £1 billion ($1.34 billion) lifeline, which would allow it to restructure its £16 billion debt and avoid the threat of administration, according to sources familiar with the situation.

Last week, the UK's largest water company warned that it could face insolvency within three months if the majority of its creditors do not sanction additional borrowing. In the absence of a viable rescue strategy, the government or water regulator Ofwat might place Thames Water into a special administration regime to ensure uninterrupted service to its 16 million customers in London and surrounding areas.

To avert such an outcome, Thames Water is in discussions with a group of creditors about an interim £1 billion liquidity facility, with an agreement possibly being reached in the coming weeks. This credit line is crucial for maintaining operations until a longer-term debt restructuring and fundraising solution, potentially up to £3.25 billion, can be achieved.

(With inputs from agencies.)