UK government lines up insolvency firm in case Thames Water collapses
The UK government has appointed insolvency specialists to step up planning for Thames Water in case the troubled water company collapses.
Environment Secretary Steve Reed signed off the appointment, with Sky News reporting FTI Consulting Inc will act as an administrator in case Thames fails to secure funding from lenders.
Contingency plans could see Britain’s biggest water firm placed into a special administration regime, SAR, meaning it would be put into an insolvency process.
A spokeswoman for the Department for Environment, Food & Rural Affairs, Defra, said: ‘The government will always act in the national interest on these issues.
‘The company remains financially stable, but we have stepped up our preparations and stand ready for all eventualities, including applying for a special administration regime if that were to become necessary.’
Thames Water, which has 16 million customers, remains locked in talks over a rescue funding deal with a number of senior creditors.
In June, private equity firm KKR pulled out of plans to inject around £4 billion of cash into the financially-stricken company in a bid to keep it afloat.
Thames Water Chair Adrian Montague recently said the firm was still in ‘crisis mode’ as it seeks to avoid special administration measures.
A spokeswoman for Thames Water said: ‘Our focus remains on a holistic and fundamental recapitalisation, delivering a market-led solution which includes targeting investment grade credit ratings and returning the company to a stable financial foundation.
‘Constructive discussions with our many stakeholder continue.’
FTI Consulting has been contacted for comment.
By Anna Wise, PA Business Reporter
Press Association: Finance
source: PA
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