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Thames Water could run out of money by April
https://www.whatjobs.com/news/united-kingdom/uk-business-news/thames-water-could-run-out-of-money-by-april
By Hugh Fort in UK Business News, posted December 4, 2023
The largest water company in the UK could run out of money by April if shareholders do not inject more money into the struggling firm.
Auditors PricewaterHouseCoopers, expressed "material uncertainty" over the company's ability to continue operation after the revelation.
The concerns come from the absence of a concrete plant to refinance a £190 million loan in one of Thames Water's subsidiaries.
READ MORE: Thames Water Could Axe As 300 Jobs
The UK government is preparing contingency plans for the potential collapse of the company.
Thames Water could also face an inquiry into whether it misled MPs earlier this year.
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Sir Robert Goodwill, chair of the environment, food and rural affairs select committee, said it was considering a fresh investigation after reports Thames Water had originally presented a loan from its shareholders to its parent as new equity funding.
Alastair Cochran, chief financial officer at Thames Water,told MPs in July its “incredibly supportive” shareholders “have already provided £500m of equity this year, in March, which was fully drawn by the company”.
However, the Kemble accounts show the investment had come in the form of a £515m convertible loan reportedly charging eight percent interest per year.
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"We are in a robust financial position"
A spokesperson for Thames Water said: “We are in a robust financial position and are extremely fortunate to have such supportive shareholders.
“Our shareholders have already invested £500m of equity in 2023.
"In addition, they have agreed to provide a further £750m in new equity funding across AMP7 [the water industry asset management plan period running from 2020 to 2025].
“This further funding is subject to satisfaction of certain conditions, including the preparation of a business plan that underpins a more focused turnaround that delivers targeted performance improvements for customers, the environment and other stakeholders over the next three years and is supported by appropriate regulatory arrangements.”
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