If Thames Water doesn't sort its finances it could end up being nationalised.
Shareholders in Thames Water have agreed to provide a further £750m in funding as the company attempts to fight the threat of government control.The water firm has faced criticism over sewage discharges and leaks and is struggling under a mountain of debt.
She said the company had access to £4.4bn of cash and credit facilities. "That's absolutely enough to pay everything that we think we need to pay this year, next year and into the future."However, the £750m that investors agreed to pump in to Thames between now and 2025 is less than the £1bn the company was seeking. The extra funds are also dependent on Thames improving its business plan to revive the company.
The regulator for the water industry, Ofwat, will be questioned by MPs on Wednesday amid accusations that it has been too lax in its oversight of the sector. He also admitted the regulator had taken a "relatively hands-off approach" to managing water companies since the industry was privatised in the late 1980s.
Thames Water has said that it has not paid dividends to external shareholders for the past five years. "In the last year, we paid £45m out to service the debt that is essentially provided by our shareholders, through the holding company. Our revenues last year were £2.3bn - so you're talking about less than 2% of our revenues went to service that debt," she told the BBC.
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