Thames Water Needs £10 Billion Under Elliott, Silver Point Plan
(Bloomberg) -- Funds including Silver Point Capital and Elliott Management are working on a rescue plan for British utility Thames Water that would total more than £10 billion ($13.5 billion), according to people familiar with the matter.
The proposal, the main terms of which are similar to the one presented by US alternative investor KKR & Co. before it walked away from its planned investment this week, would involve a sweeping debt restructuring. There would be a multibillion pound haircut for senior creditors, the people said. That would be on top of cuts for the utility's more junior Class B bonds and loans, as well as for debt at the holding level, amounting to approximately £3 billion.
The package would also include an equity injection of between £3 billion and £4 billion to stabilize the company's finances. The specific terms of the plan are still being finalized.
A spokesperson for the senior creditor group, which includes Silver Point and Elliott, confirmed that it has submitted a detailed long-term turnaround proposal for the company to 'restore its balance sheet, rebuild customer trust and fix the fundamentals of the business.' A spokesperson for Thames Water declined to comment.
Thames Water is in a race against time to fix its finances. Britain's largest water and sewage utility is already eating into an emergency loan that it was granted by senior creditors to prevent its cash from drying up, and is scrambling to find fresh equity. The company needs to find a turnaround plan that will reduce its debt pile of nearly £20 billion.
Previous shareholders called the company uninvestible, writing off their stakes and leaving it to the creditors. The utility, which supplies about a quarter of the UK's population, came close to running out of money several times before obtaining the emergency loan.
The details of the latest proposal, which aims to return the company to investment-grade status, are emerging after Thames Water confirmed it's working with its senior creditors to recapitalize and restore its finances. Regulator Ofwat will need to discuss the details with the creditor group in the coming weeks. The creditors said in a statement this week that the plan is fully-funded.
Should the process of raising equity fail, Thames could fall into a special administration regime, or SAR, a temporary state-supervised process akin to insolvency designed for bankrupt businesses that provide critical services.
More stories like this are available on bloomberg.com
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
&w=3840&q=100)
First Post
2 hours ago
- First Post
Lammy meets PM Modi, pushes UK-India counter-terrorism cooperation and trade deal
British Foreign Minister David Lammy is the highest-profile Western official to have visited both New Delhi and Islamabad since the South Asian neighbours agreed to a ceasefire last month after their worst fighting in nearly three decades. read more Britain and India held talks on strengthening their counter-terrorism cooperation in the wake of recent cross-border clashes between India and Pakistan, UK Foreign Minister David Lammy told Reuters on Saturday following a meeting with Indian Prime Minister Narendra Modi. Lammy's visit makes him the most senior Western official to travel to both New Delhi and Islamabad since the South Asian rivals agreed to a ceasefire on May 10, ending their most intense period of conflict in nearly 30 years. STORY CONTINUES BELOW THIS AD Thank you Prime Minister @narendramodi for your warm welcome to India. Building on the free trade agreement between our great countries, we will continue working together to deepen our partnership, celebrate our unique living bridge, and deliver growth and security. — David Lammy (@DavidLammy) June 7, 2025 Indian Prime Minister Narendra Modi stressed the need for decisive international action against terrorism and those supporting it in a meeting with Lammy. The Prime Minister's Office said Lammy strongly condemned the Pahalgam terror attack. PM Modi expressed satisfaction at the successful conclusion of the India-UK Free Trade Agreement and Double Contribution Convention and appreciated the constructive engagement by both sides that led to this milestone. Pleased to meet UK Foreign Secretary Mr. David Lammy. Appreciate his substantive contribution to the remarkable progress in our Comprehensive Strategic Partnership, further strengthened by the recently concluded FTA. Value UK's support for India's fight against cross-border… — Narendra Modi (@narendramodi) June 7, 2025 STORY CONTINUES BELOW THIS AD The PMO statement said Modi welcomed the growing momentum in bilateral ties and expressed satisfaction at the deepening of the India-UK Comprehensive Strategic Partnership. He welcomed the continued collaboration under the Technology Security Initiative and noted its potential to shape trusted and secure innovation ecosystems. Tensions had surged in April after 26 people were killed in India's Kashmir, an incident India blamed on Pakistan-backed militants, which Islamabad denied. In response, India launched strikes on what it described as terrorist infrastructure inside Pakistan, prompting retaliatory moves and escalation until both countries agreed to halt hostilities. 'We want the situation to be maintained, but of course we recognise fragility, particularly in the backdrop of terrorism, terrorism designed to destabilise India,' Lammy said in an interview at the residence of the British High Commissioner in New Delhi. STORY CONTINUES BELOW THIS AD 'We are keen to continue to work with our Indian partners on counter-terrorism measures.' He said he discussed the next steps with both Modi and Indian Foreign Minister S. Jaishankar, but gave no specifics. Last year, India and Britain discussed combating the financing of terrorism, cooperation between law enforcement and judicial bodies and information sharing. Lammy said he also discussed boosting trade between the world's fifth and sixth largest economies. The countries concluded talks for a free trade deal early last month. 'I know that Prime Minister Keir Starmer is very much looking forward to coming to India very soon to sign the free trade agreement,' Lammy said. 'There is so much that our two nations can continue to do together.' With inputs from agencies
Economic Times
3 hours ago
- Economic Times
China says willing to improve communication with countries on rare earth controls
TIL Creatives China says willing to improve communication with countries on rare earth controls China's commerce ministry said on Saturday that it has approved a certain number of compliant rare earth export applications and will continue to refine its examination and approval process. The ministry also expressed willingness to enhance communication with other countries over export controls, according to a statement on its website, Reuters reported. The announcement comes at a time when Indian automakers are facing worsening shortages of rare earth magnets, critical components for electric vehicles (EVs) and other high-tech industries. According to Bloomberg, Beijing has turned down at least two recent applications for India-bound shipments of rare earth magnets, raising fears of an imminent disruption in Indian automobile production. Industry and government officials told Bloomberg that while shipments to the German and U.S. units of a global firm were cleared, the same request to its Indian arm was rejected. Since April 4—when China began enforcing tighter curbs on exports of seven rare earth elements—supplies to Indian auto parts manufacturers have been stuck at Chinese new controls require importers to certify that the magnets will not be used for defense purposes or re-exported to the U.S. The new end-user certification process can take at least 45 days and is now facing a global per the Bloomberg report, at least 30 Indian applications endorsed by the Indian government are still awaiting Chinese approval, while over 10 applications from other countries have reportedly been cleared. According to a May 28 presentation by the Society of Indian Automobile Manufacturers (SIAM), no Indian applications have received final approval from China's commerce ministry despite many having secured embassy endorsements. 'Even if one magnetised part is missing, the vehicle cannot be built,' SIAM warned in the presentation, adding that some Indian firms may consider shifting operations to China if the supply crunch continues. The squeeze has heightened concern among Indian automakers. 'The rare earth situation is a very difficult one,' Bajaj Auto's Executive Director Rakesh Sharma told analysts. 'Supplies and stocks are getting depleted as we speak, and if there's no relief in shipments, production will be seriously impaired in July.'To address the growing crisis, a delegation of Indian businesses is planning to visit Chinese counterparts this month with help from the Indian Embassy in Beijing. The embassy has reached out to China's commerce ministry, seeking expedited clearance of pending applications.A meeting was recently held at the Indian Prime Minister's Office to discuss options for resolving the impasse. Indian officials have advised manufacturers to explore alternative supply chains and consider local refining capacities—though such solutions are long-term in the Indian government is also encouraging firms to explore ferrite magnets or magnet-free designs, though these come with compromises in cost and performance. As a result, some companies are considering stop-gap measures such as importing motors or shifting production to fossil-fuel-powered vehicles. With inputs from agencies
Hindustan Times
4 hours ago
- Hindustan Times
UK expresses support for India's fight against cross-border terrorism
New Delhi: Prime Minister Narendra Modi and external affairs minister S Jaishankar reiterated India's 'zero tolerance' policy for terrorism and the need for decisive international action against terror and those who support it during meetings with British foreign secretary David Lammy on Saturday. Modi said India valued Britain's backing for the fight against cross-border terrorism while Jaishankar said India's partners should understand the 'zero tolerance' policy for terrorism as the country will never accept the perpetrators of terrorism being treated at par with victims. The remarks by the top Indian leadership, made against the backdrop of several countries hyphenating India and Pakistan during last month's military clashes, reiterated to the world community New Delhi's new approach to fighting cross-border terrorism backed by Islamabad. Britain's foreign office had said before Lammy's meeting with Indian interlocutors that he would address how the current peace between India and Pakistan can be supported for regional stability. Modi said in a social media post after meeting Lammy that he values 'UK's support for India's fight against cross-border terrorism'. He also appreciated Lammy's 'substantive contribution to the remarkable progress in our Comprehensive Strategic Partnership, further strengthened by the recently concluded FTA'. A statement from the external affairs ministry said Modi had 'underscored the need for a decisive international action against terrorism and those who support it' - an apparent reference to Pakistan. The two leaders discussed regional and global issues and Lammy 'strongly condemned the Pahalgam terror attack and expressed support for India's fight against cross-border terrorism', the statement said. Modi also expressed satisfaction at the conclusion of the free trade agreement (FTA) and the double contribution convention and expressed satisfaction at the deepening of the bilateral comprehensive strategic partnership. He welcomed continued collaboration under the Technology Security Initiative (TSI), especially its potential to 'shape trusted and secure innovation ecosystems'. Modi also reiterated his invitation to British Prime Minister Keir Starmer to visit India. Lammy arrived in New Delhi on Saturday morning for meetings to review the bilateral partnership, especially trade and strategic ties, a month after India and the UK finalised the FTA. Lammy had visited Pakistan shortly after New Delhi and Islamabad reached an understanding on halting military actions on May 10. In his opening remarks at the meeting with Lammy, Jaishankar thanked the UK government for the strong condemnation of the 'barbaric terrorist attack' in Pahalgam and its support to India in the fight against terror. 'We practice a policy of zero tolerance against terrorism and expect our partners to understand it, and we will never countenance perpetrators of evil being put at par with its victims,' he said. Lammy responded by referring to the 'horrific terrorist attack' and said Prime Minister Starmer had asked him to convey the 'deep condolences of the UK and a hand of friendship with India and support as we deal with the terrorism threat in a comprehensive manner'. Jaishankar described the finalisation of the FTA and double contribution convention as a milestone that will boost two-way trade and investment and have a 'positive effect on other strategic aspects' of bilateral relations, besides strengthening supply and value chains. He also referred to other significant initiatives that have seen progress, such as the TSI for deeper collaboration in strategic sectors such as AI, semiconductors, telecom, quantum computing, health technology, critical minerals and advanced materials. The TSI, coordinated by the national security advisers of India and the UK, was launched during Lammy's last visit to New Delhi in July 2024. 'We have also launched the Strategic Exports and Technology Cooperation Dialogue, the first meeting of which was held…this week. This will enhance, among others. the TSI's effectiveness in promoting trade in critical and emerging technologies, including the resolution of relevant licencing or regulatory issues,' Jaishankar said. The India-UK infrastructure financial bridge can unlock quality long-term capital flows from Britain to India and contribute to infrastructure development, and there is also good collaboration in the education sector with many UK universities planning to establish campuses in India, he said. Lammy described the finalisation of the FTA as Britain winning a 'trophy' and the beginning of a new era in bilateral ties since it is expected to increase will trade by £25.5 billion. He also conveyed the UK's interest in enhancing cooperation in key sectors such as trade, investment, defence and security, technology, innovation and clean energy. Lammy also met commerce minister Piyush Goyal and National Security Adviser Ajit Doval. A readout from Britain's foreign office said bolstering economic and migration ties and delivering growth opportunities for British businesses topped the agenda for Lammy's visit. Lammy also focused on the migration partnership, including 'work on safeguarding citizens and securing borders in both countries'. The readout added, 'Addressing migration remains a top priority for the government - the Foreign Secretary is focused on working internationally with global partners to secure the UK's borders at home.' Lammy's visit would also prepare the grounds for a visit by Starmer to India for the formal signing of the FTA. Both countries are currently involved in the legal scrubbing of the FTA, a process expected to be completed in three months. During 2023-24, India was the UK's second largest source of investments in terms of number of projects for the fifth consecutive year. India was the UK's 11th largest trading partner in 2024, accounting for 2.4% of total British trade, and two-way trade in goods and services was worth nearly $57 billion in 2024. The FTA is expected to increase bilateral trade by $34 billion a year from 2040. Within a decade of the deal being implemented, 85% of British products will become tariff-free in India. Indian tariffs on alcohol will be cut from 150% to 75%, falling to 40% by the 10th year of the deal. India will also cut automotive tariffs from more than 100% to 10%. The UK too has agreed to cut its tariffs and 99% of India's exports to Britain will face no duties.
