Thames Water Nears £16bn Rescue Deal

Thames Water, Britain’s largest water utility, is on the brink of a £16 billion rescue package that would keep the 20 billion‑pound debt‑laden company out of state administration. In‑principle talks between a group of creditors – including Assured Guarantee, Invesco, Elliott Management, Silver Point Capital and Farallon Capital – and Ofwat are due by the middle of February 2026. Lenders are poised to accept a 30 % haircut on Class A debt, up from the 25 % announced in October, while the deal would write off an estimated £13 bn of bad debt, rising from £12.5 bn. An additional £3.15 bn equity injection is likely, with creditors earning a minimum 10 % stake. The consortium, London & Valley Water, plans £20.5 bn for infrastructure over five years and pledges no dividend until after a 2030 listing. Approval must come from Ofwat, the Environment Agency and the Drinking Water Inspectorate, and is subject to court sanction and Downing Street review.