Thames Water future in doubt as US backer pulls out of rescue deal
The future of Thames Water has been thrown into doubt after a US private equity giant pulled out of a £4bn deal to buy a stake in the troubled supplier.
Thames Water announced on Tuesday that New York headquartered KKR has 'indicated that it will not be in a position to proceed' with the refinancing deal.
KKR was previously selected as the company's 'preferred partner' in the fundraising process on March 31 this year.
Thames said it now intends to start discussions with water regulator Ofwat and other stakeholders on the best way to proceed.
Chairman Sir Adrian Montague said: 'Whilst today's news is disappointing, we continue to believe that a sustainable recapitalisation of the company is in the best interests of all stakeholders and continue to work with our creditors and stakeholders to achieve that goal.'
'The company will therefore progress discussions on the senior creditors' plan with Ofwat and other stakeholders. The board would like to thank the senior creditors for their continuing support.'
It comes after a new report said the water industry needed a 'fundamental reset' after being plagued with 'deep-rooted, systemic' failures.In an interim report published on Tuesday, the Independent Water Commission called for a 'fundamental strengthening and rebalancing' of Ofwat's regulatory role, calling for the watchdog to adopt a more supervisory approach to its oversight of water firms.Sir Jon Cunliffe, chairman of the Independent Water Commission, said: 'We have heard of deep-rooted, systemic and interlocking failures over the years - failure in Government's strategy and planning for the future, failure in regulation to protect both the billpayer and the environment and failure by some water companies and their owners to act in the public, as well as their private, interest.'
This is a breaking news story. More updates to come.
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