Achi news desk-
Debt-ridden Thames Water has failed to raise a major cash injection from shareholders, it revealed on Thursday, blaming industry regulations that made its rescue plan “uninvestable”.
London, (APP – UrduPoint / Pakistan Point News – 28th March, 2024) Debt-ridden Thames Water has failed to raise a major cash injection from shareholders, it revealed on Thursday, blaming industry regulations that his rescue plan is “uninvestable”.
Britain’s biggest water supplier said in a statement that £500 million ($630-million) of new equity “will not be provided by Thames Water shareholders” this month.
The cash represented the bulk of a £750m funding bailout agreed with investors in July to keep the water afloat.
The company said on Thursday it was in talks with industry regulator Ofwat about a plan that is “affordable for customers, deliverable and fundable for Thames Water, as well as investable for equity investors”.
Britain’s domestic Press Association news agency said Ofwat had refused to bow to Thames Water’s demands for concessions, which it said included a 40 percent jump in water bills that would exacerbate the country’s cost-of-living crisis.
Other concessions sought are said to include relaxation of capital expenditure requirements and leniency over regulatory penalties.
– ‘Follow all options’ –
“Safeguards are in place to ensure that services to customers are protected regardless of the issues facing Thames Water’s shareholders,” said an Ofwat spokesman.
“Today’s update… means that the company must now pursue all options to seek more equity in order for the business to transform the company’s performance for customers.”
Thames Water, which supplies more than 15 million homes and businesses in London and elsewhere in the south of England, is saddled with debts of almost £15 billion which has put it at risk of nationalisation.
“We are preparing for a range of scenarios across our regulated industries – including water – as any responsible government would,” said a statement on Thursday from the Conservative administration led by Prime Minister Rishi Sunak.
Steve Reed, environment spokesman for the main opposition Labor party, said “the government and regulators must do everything they can to stabilize the company and ensure that new investment comes through to fix the broken sewage system without the taxpayers being left to foot the bill.”
Labour, widely tipped to win this year’s UK general election according to several polls, will “strengthen the regulator’s powers and make financial stability a priority to prevent this from happening again” if n gain power, Reed added in a statement.
Thames Water has faced fierce criticism over missing targets to reduce leakages and reduce sewage discharges into rivers, despite major investment in infrastructure.
Environmentalists have voiced growing anger at the rise in pollution on UK beaches and waterways, and pointed the finger at privatized water companies.
Elsewhere on Thursday, researchers revealed that high levels of E.coli, a bacteria found in human waste, had been found in London’s River Thames.
On Saturday the river will host the Oxford and Cambridge Boat Race – an annual event featuring competitive rowing crews from England’s two oldest universities.
