Over the last week, there have been a number of stories in the media about the continued troubles for Thames Water. As we wrote earlier this year, contingency plans for Thames Water are ongoing as it reportedly requires an extension for borrowings of more than £1bn before December (those loan facilities having been extended already earlier this year). Of that sum, a £530m credit facility apparently falls due on 7 October, so the time of reckoning may soon be upon us. Rothschild & Co have reportedly been tasked with raising billions of pounds of equity from investors but, given Thames Waters' financial woes, it appears there has been little interest in further investment so far. 

With no immediate financial assistance on the horizon, and cash reserves running low, it now appears that a restructuring plan may be in contemplation for Thames Water. The Financial Times is reporting that the company has two hearing dates in the diary with a view to proposal of a restructuring plan later this year, if sufficient investment cannot be found. A restructuring plan would be possible for Thames Water within the context of special administration following the implementation of The Water Industry Special Administration Regime (the Regime) earlier this year. The Regime was implemented in the wake of Thames Waters' financial struggles with the aim of facilitating business rescue if the government were required to step in by way of special administration. 

In the meantime, Thames Water is also reportedly in negotiations with a group of 90 creditors holding £9bn of debt to provide a new loan with super senior status to extend its so-called “liquidity runway”.

There are a number of factors at play for Thames Water, including negotiations with Ofwat regarding how much it can bill customers over the next five years. What is clear, however, is that Thames Water is fighting tooth and nail to keep its head above water, and decisions taken over the coming months will be pivotal for its survival.