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...That has left the company rushing to raise more than £3bn in fresh capital by 2030, including £750mn by next year, to keep services running and improve its water and sewage infrastructure....
...Leaver said: “In the absence of dividends, which are often used to service the debt at the holding companies, the financial companies will go bust pretty quickly.”...
...They’ve already paid a high price through the company’s poor complaints record and service levels,” said Mike Keil, chief executive of the CCW....
...Kemble, which has no source of income other than Thames Water bills, relies on dividends from the water company to service its borrowings....
...However, new rules introduced by Ofwat last year prevent the payment of dividends from the operating company if they put the company’s financial resilience at risk or if a utility underperforms on social...
...Ethio Lease, a unit of New York-based African Asset Finance Company, is the first and only foreign group to secure a financial services licence to operate in Ethiopia....
...Kemble, which was set up to raise finance for Thames Water, needs the dividends to service its debt but new rules introduced last year forbid water utilities with poor financial records from making payouts...
...Other companies have also been amending their business plans following discussions with Ofwat....
...US hedge fund Elliott Management has been buying the bonds of troubled British utility company Thames Water, in a bet that markets have grown too pessimistic over the size of losses that investors may have...
...In 2008, some companies that people thought were too big to fail failed....
...Shouting matches between utility companies and regulators are common in the UK....
...Leverage is high at about 80 per cent in the utility, the debt held in the subsidiary company Thames Water Utilities Finance, within the regulatory ringfence....
...the restructuring experts, will discuss all options with creditors, which include bank lenders and bondholders, as the government tries to avoid a temporary renationalisation of the UK’s largest water utility...
...Already-poor service levels would deteriorate further. In the meantime, there is a risk of Thames’s toxicity starting to pollute other water companies....
...That in turn would threaten to push its (already dismal) service levels below the standards required by its licence....
...Investors have demanded scope to increase bills and loosen rules over paying dividends, despite public anger over sewage discharges and the service record of the privatised utility....
...However, while some people believe privatised water utilities will function better than public services, there is no evidence that this is always the case, says Biswas....
...Thames Water, the UK’s biggest water company, provides water and sewage services to 16mn people, or around 25 per cent of the population....
...In the meantime, public hostility is making it unfeasible for the company to raise fresh equity and service its debt....
...Sir Adrian Montague has quit as chair of Thames Water’s parent company after less than a year, as the utility faces a regulatory investigation over its decision to pay shareholders a dividend....
...Macquarie put in place a so-called “whole-business securitisation”, where the utility’s cash flows service different tiers of debt....
...In a 2022 podcast, its energy and climate director Michael Terrell said the company had engaged regulators at local public utilities commissions, showing up to the scantily-attended meetings where crucial...
...Other water companies have high gearing too, built up in the decades since their 1989 privatisations....
...Shares of utility company Xcel Energy dropped sharply this week over potential financial exposure to the largest wildfire in Texas history....
...By 2006, when the Australian asset management firm Macquarie bought Thames Water from the Germany utility group RWE, the water company had £3.4bn in debt....
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