Latest news with #CharlieMaynard
Yahoo
5 days ago
- Business
- Yahoo
Should water companies should be nationalised? Have your say
Yahoo UK's poll of the week lets you vote and indicate your strength of feeling on one of the week's hot topics. After the poll closes, we'll publish and analyse the results each Friday, giving readers the chance to see how polarising a topic has become and if their view chimes with other Yahoo UK readers. The government has refused to be drawn on whether it plans to nationalise Thames Water, after a US private equity giant pulled out of plans for a rescue deal to keep the struggling provider afloat. Britain's biggest water supplier, which has 16 million customers, chose KKR at the end of March to be its preferred bidder under plans to invest around £4bn of new equity. Now, however, Thames Water says KKR is not 'in a position to proceed' and that its preferred bidder has dropped out. KKR's withdrawal comes just days after talks with Downing Street officials, with sources close to the deal telling Sky News that the firm's New York-based executives were not comfortable with the risk of propping up Thames Water, which has about £19bn in debt. Thames Water said it is instead taking forward talks with 'certain senior creditors' on an alternative plan, while consulting with regulator Ofwat. These creditors are the bondholders who effectively own the firm after the High Court approved a financial restructuring loan of up to £3bn to keep the company running until summer 2026. While the government has not abandoned helping to secure a new private-sector deal, the latest development raises the spectre of temporary nationalisation of Thames Water once more. Environment Secretary Steve Reed insisted that 'Thames itself remains stable', but added: 'The government is clearly keeping a very close eye on what's going on.' Water companies have faced public and political outrage over the extent of pollution, rising bills, high dividends, and executive pay and bonuses. Thames Water hiked consumer water bills for customers by an average of 31% in April and incurred further wrath over plans to pay senior bosses large bonuses linked to the water company securing a £3bn emergency loan, which were later dropped. Calls for the government to step in and take Thames Water into public hands have mounted further after the latest setback with KKR, with Lib Deb MP Charlie Maynard claiming: "The company is now at the end of the road. 'The government needs to bite the bullet and put Thames Water into special administration so its unsustainable debt can be written down and the interests of Thames Water's 16 million customers can be protected.' Russ Mould, investment director at AJ Bell, said that Thames Water "has been like a sponge, soaking up debt and getting into a financial mess", and that it is looking increasingly like it will have to be nationalised. He said that if the government did step in, it "would represent a soggy end to what's been a failed privatisation". However, not everyone believes that nationalising water companies will serve the public's interests, including Lord Howard, who led the privatisationof the industry more than 30 years ago under Margaret Thatcher. Defending payouts to investors as crucial to maintaining critical water infrastructure, he told BBC Radio 4 in 2023: "You can pay for them by borrowing, in which case interest has to be paid to the lenders, or you can pay for them by raising private capital, in which case dividends have to be paid to the people who provide that capital. "That is the only choice available, there is no free lunch." Water UK argues that before privatisation, England's water system was "underfunded, inefficient, with poor service and a disastrous environmental record which left rivers and beaches badly polluted", adding that investment "doubled" afterwards. Environment Secretary Steve Reed has said nationalisation was 'not the answer' to a failed bid to rescue Thames Water, claiming public ownership could pull money away from the NHS. Speaking in Parliament today, Reed said 'We are not looking at nationalisation because it would cost over £100bn of public money that would have had to be taken away from other public services like the National Health Service to be given to the owners of the water companies. 'It will take years to unpick the current model of ownership, during which time pollution would get worse and we know that nationalisation is not the answer – you only have to look at the situation in Scotland to see that." However, the government's £100bn figure has been called into question, with The Guardian reporting in September last year that the number was based in a 2018 report by the Social Market Foundation think tank, which was commissioned by United Utilities, Anglian Water, Severn Trent and South West Water. Economist Sir Dieter Helm described the analysis as 'economically illiterate', while Moody's rating agency estimated that nationalisation could cost a £14.5bn – nearly a tenth of the government's estimate. Looking at Thames Water specifically, consultancy firm Teno has suggested temporary nationalisation, over an 18-month period, could cost between £3.4bn and £4.1bn. So, what do you think? Is it time to nationalise the UK's water industry? Let us know in the poll below? Should water companies should be nationalised and run in the public sector?Come back on Friday to read the results and analysis via the link below. Read more of Yahoo UK's Poll of the Week articles
BBC News
6 days ago
- Business
- BBC News
Thames Water should be put in administration, MP says
An MP has called for Thames Water to be put into administration after a US firm pulled out of a deal to buy the struggling utilities company. Lib Dem Charlie Maynard, who represents Witney in Oxfordshire, said the government had a "big problem" after private equity giant KKR withdrew from a £4bn deal. Maynard had previously argued against a £3bn rescue deal for Thames Water, but an appeal against it was dismissed in March. Thames Water has called news of the failed bid "disappointing" but said it would proceed to work with other potential investors. Speaking to BBC Radio Oxford, Maynard said the government would now be "scrambling to try and fix" the situation. He renewed his calls from earlier in the year that the company should be put into government-supervised administration. "They should be in bankruptcy, because you can't deal with this enormous amount of debt... you've got to cut it down into something sustainable."He added: "The government is just doing anything it can to not do the fundamental thing that will actually fix it." Maynard said he was considering taking his case for putting the company into special administration to the Supreme Court. The government has previously said it is ready to take over Thames Water in the event that it cannot continue to Thames Water and the Department for the Environment, Food and Rural Affairs have been contacted for comment. You can follow BBC Oxfordshire on Facebook, X (Twitter), or Instagram.
Yahoo
31-03-2025
- Business
- Yahoo
‘Barbarians at the gates' come for Thames Water
A US private equity firm is in pole position to buy Thames Water as the embattled utility tries to stave off a looming cash crunch. New York-based KKR, whose staff were once dubbed 'barbarians at the gates' for their aggressive culture, has entered the second stage of negotiations over a potential cash injection that would help the company avoid collapse. However, Thames Water said there was no certainty that a deal would be reached as it remained subject to due diligence and regulatory approvals. A takeover of Thames by KKR would reduce the risk that the utility requires a government-backed bailout if it runs out of cash. Bosses said senior creditors, which include hedge funds Elliott and Apollo, are continuing separate discussions over an equity raise in case the deal falls through. Thames, which serves 16m customers across London and the South East, recently agreed a £3bn emergency loan from its creditors. But the company, which is struggling under debts of roughly £20bn, is now seeking billions of pounds in fresh equity to shore up its finances and avoid unprecedented renationalisation. Thames's existing shareholders, who include the sovereign wealth funds of China and Abu Dhabi as well as the pension funds USS and Omer, last year walked away from the company, branding it 'uninvestable'. The apparent breakthrough comes days after Thames announced the surprise departure of its chief financial officer. The company last week said that Alastair Cochran, who has been at the company since 2021 and recently served as interim chief executive, will step down within days. The financial crisis at England's biggest water supplier comes amid public anger over rising bills and sewage leaks. Thames plans to raise average water bills by £31 a year, meaning the average annual household bill would jump from £436 to £588 between now and 2030. Bosses have argued the price rises are necessary to fund a £21bn investment in the company's crumbing Victorian infrastructure. But Thames has faced vocal opposition from rival creditors and campaigners including Charlie Maynard, the Liberal Democrat MP for Witney in Oxfordshire. Mr Maynard argued against the £3bn emergency loan, saying the Government should instead step in to nationalise the utility. He described the restructuring as 'simply throwing good money after bad'. KKR's selection as preferred bidder comes after it saw off competition from rival suitors, who are reported to have included Hong Kong giant CKI Infrastructure, UK-based Castle Water and a French consortium led by Covalis. Thames said KKR's proposal included financial metrics that indicate a 'material impairment' of the company's class A debt, while other aspects of the deal remain under discussion. Thames Water said: 'The company remains focused on putting Thames Water on a more stable financial foundation, implementing its turnaround plan and delivering a market led solution that is in the best interests of customers, UK taxpayers and the wider economy. 'Agreed transaction terms are targeted for the second quarter of 2025 with a view to completing a recapitalisation in the second half of 2025.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Sign in to access your portfolio
Telegraph
31-03-2025
- Business
- Telegraph
‘Barbarians at the gates' come for Thames Water
A US private equity firm is in pole position to buy Thames Water as the embattled utility tries to stave off a looming cash crunch. New York-based KKR, whose staff were once dubbed 'barbarians at the gates' for their aggressive culture, has entered the second stage of negotiations over a potential cash injection that would help the company avoid collapse. However, Thames Water said there was no certainty that a deal would be reached as it remained subject to due diligence and regulatory approvals. A takeover of Thames by KKR would reduce the risk that the utility requires a government-backed bailout if it runs out of cash. Bosses said senior creditors, which include hedge funds Elliott and Apollo, are continuing separate discussions over an equity raise in case the deal falls through. Thames, which serves 16m customers across London and the South East, recently agreed a £3bn emergency loan from its creditors. But the company, which is struggling under debts of roughly £20bn, is now seeking billions of pounds in fresh equity to shore up its finances and avoid unprecedented renationalisation. Thames's existing shareholders, who include the sovereign wealth funds of China and Abu Dhabi as well as the pension funds USS and Omer, last year walked away from the company, branding it 'uninvestable'. The apparent breakthrough comes days after Thames announced the surprise departure of its chief financial officer. The company last week said that Alastair Cochran, who has been at the company since 2021 and recently served as interim chief executive, will step down within days. The financial crisis at England's biggest water supplier comes amid public anger over rising bills and sewage leaks. Thames plans to raise average water bills by £31 a year, meaning the average annual household bill would jump from £436 to £588 between now and 2030. Bosses have argued the price rises are necessary to fund a £21bn investment in the company's crumbing Victorian infrastructure. But Thames has faced vocal opposition from rival creditors and campaigners including Charlie Maynard, the Liberal Democrat MP for Witney in Oxfordshire. Mr Maynard argued against the £3bn emergency loan, saying the Government should instead step in to nationalise the utility. He described the restructuring as 'simply throwing good money after bad'.
Yahoo
17-03-2025
- Business
- Yahoo
Thames Water: Challenge to £3bn emergency loan dismissed by Court of Appeal
An appeal against a £3bn rescue package for Thames Water has been dismissed following a three-day hearing last week. The Court of Appeal's ruling on Monday averts the possibility of the UK's biggest water supplier being placed into special administration (SAR). But critics argue the £3bn emergency loan from a group of Class A creditors is only a short-term fix for the troubles at Thames Water and a SAR is in the public interest. Thames Water has amassed debts of more than £19bn and is under pressure to upgrade creaking infrastructure and reduce sewage leaks. The full details of the court's reasons for the dismissal are set to be published in due course. Additionally, all other consequential matters are paused until the full judgment is handed down. A group of Thames Water's Class B creditors and the Liberal Democrat MP, Charlie Maynard, appealed against the decision at a three-day hearing last week. Andrew Thornton KC previously told the court the terms of the agreement were 'mispriced and inappropriate' and were 'designed by senior lenders for the benefit of senior lenders.' Thames Water's parent company, TWUH, and its Class A creditors had challenged the appeal. Responding to the judgement, Thames Water chief executive Chris Weston said: 'We are pleased that the Court of Appeal has today decisively refused the appeals and upheld the strong High Court decision to sanction the Company Plan. 'We remain focused on putting Thames Water onto a more stable financial foundation as we seek a long-term solution to our financial resilience. 'Today's news demonstrates further progress.' A spokesperson for the group of Class A creditors said: 'The decision from the Court is clear and we hope this brings to an end the ongoing legal distractions so all parties can focus all efforts on securing billions in fresh equity and new long-term ownership for Thames Water. 'A market-based solution is the best route to achieving financial sustainability for the company in the coming months and will deliver the complex operational turnaround, improved service and environmental outcomes customers rightly expect and deserve. 'Customers will be placed at the centre of the rebuild and will not bear the costs of the restructuring. We will now be working with the company to allow it to move forward and access the money it needs to continue to invest in the business and work with stakeholders to complete an equity process this Summer.' A statement from the Class B creditors reads: 'While we are disappointed with the Court of Appeal's decision to dismiss our appeal, we are pleased the Court has struck out the proposed releases of the company's directors and advisors from legal liability, which the Class B Creditors have consistently maintained are inappropriate in an interim restructuring plan such as this one. 'Until the Court of Appeal releases its judgment, our position remains unchanged, and we will continue to explore all available avenues, including seeking leave to appeal to the Supreme Court, to ensure that customers and the broader public are not forced to bear the costs of a deeply flawed restructuring process.' Sign in to access your portfolio
