Thames Water Creditors Set to Vote Today on £2.4bn Emergency Loan

Thames Water's lenders are scheduled to vote today, Thursday, Oct. 29, on a request to add £2.4bn to the emergency credit line that is keeping the utility running.

The proposal would lift the super-senior facility from £3bn to £5.4bn. The company says that would extend its liquidity into autumn 2027.

How close to empty is the tank

Thames Water has drawn £2.65bn of the £3bn currently available, according to its Oct. 15 statement to the market. On the latest forecast, the company says that facility lasts only until the end of 2026 or the start of 2027.

The company also said it does not expect to finish its recapitalisation before then. That is why it is asking for the additional money.

The statement lays out the mechanics. A new entity, Thames Water Super Senior Upsize Issuer PLC, would be created to issue extra super-senior loans and bonds. Commitments for the added £2.4bn would be sought in tranches over the coming months, not delivered in one lump. The company also acknowledged that some conditions attached to the existing new commitments had not yet been fully satisfied or waived.

The lenders behind the earlier money include BlackRock, Elliott Management and Silver Point Capital. They provided a £3bn loan last year at a 9.75% interest rate. Thames Water serves 16 million customers in London and the Thames Valley. Its debt is about £20bn. Shareholders walked away in 2024, which left creditors in effective control.

The bill dispute

The fight over who pays is already underway.

Campaign group We Own It calculated that if the new £2.4bn carried the same terms and were added to bills, it would cost £40 per household in interest alone. If the full amount were counted, the figure would be £454 per household.

London & Valley Water, the creditor consortium, insists the cost will not be added to bills. A Thames Water spokesperson said tariffs are set by the regulator, Ofwat, and that the extra funding would not create new costs for households. The company had earlier said customers would not be on the hook for interest on the £3bn loan.

Sophie Conquest, lead campaigner at We Own It, said £11.9bn has been extracted from Thames Water since privatisation. "They have already had more than enough of our money," she said. She wants the government to let the company fail and move it into special administration, followed by permanent public ownership.

Charlie Maynard, the Liberal Democrat MP for Witney, said creditors "will likely hand Thames Water yet another massively overpriced rescue loan, which customers will end up having to pay for." Maynard, campaigners and junior creditors took the company to court over the £3bn loan in 2025 and lost.

Oxford University economist Dieter Helm has argued the new loans only postpone special administration, according to a report of his comments.

The takeover deal and Burnham's choices

The loan is a bridge. The destination is a separate deal.

Creditors are working on a recapitalisation that would hand them control. Bloomberg reported that their latest offer, not yet submitted, is expected to include a writedown of about 35% of the so-called Class A debt and roughly £10bn of fresh money. It needs sign-off from the regulator and from Prime Minister Andy Burnham's new government.

The Guardian reported that the deal would involve writing off fines and reducing environmental commitments. Creditors would be asking taxpayers' regulators to go easy on a company that has been a pollution and service-failure headline for years. That is a hard sell to any government.

Burnham has made water a centrepiece of a push for more public control. At Labour's conference in September he said he would look to scrap limits on state ownership of major water companies in England and Wales. His administration has also been weighing special administration, a form of government-overseen insolvency in which the state steps in while a buyer is sought. Some Labour politicians and environmental campaigners are pressing him to take that route.

Nationalisation or special administration would not make the debt disappear. Someone absorbs a £20bn problem, and if it is the state, that someone is the taxpayer. No government figure has put a price on that in the reporting so far.

The creditors' side of the argument rests on a simple point. Without fresh cash the capital programme stops, and the company says that programme delivers improvements for customers and the environment. Thames Water says it continues to work toward a market-led solution.

What happens next

The outcome of today's vote has not been announced. Even a yes would only open the process of collecting commitments in tranches. The bigger decision, whether Burnham allows a creditor takeover, moves to special administration, or pursues another form of state control, is still pending. The creditors' recapitalisation offer has yet to be formally submitted.