Thames Water has won approval to secure a £3bn emergency rescue package, after the High Court ruled on Tuesday 18th February that the water company could proceed with the loan deal.
Creditors will provide Thames with £1.5 billion pounds in an initial tranche, plus a further 1.5 billion if required, accessible in two tranches of £750m, which should provide sufficient funding till May 2026.
The Judge, Mr Justice Leech, said that the alternative to the plan being approved was temporary nationalisation.
“After taking into account the public interest in ensuring the uninterrupted provision of vital public services, I nevertheless exercise my discretion to sanction the plan,” he said.
He added that both Ofwat and the Environment Secretary had “not opposed the plan“.
Adrian Montague, Thames’s chair, said:
“The court’s approval of the company plan marks a significant milestone for Thames Water, enabling us to proceed with the implementation of the liquidity extension transaction.
“Its implementation is a key step in strengthening our long-term financial resilience and will allow us to continue progressing the equity raise process and a holistic recapitalisation transaction as well as complete the CMA appeal process. Critically, it enables the management team to continue progressing the turnaround.”
The group of B class creditors who presented their own alternative proposals are allowed to appeal.
