Thames Water to pay $1 billion under creditor takeover deal, FT reports
Key Details of the Thames Water Creditor Takeover Deal
June 10 (Reuters) - UK's Thames Water could pay £749 million ($1 billion), including fees to bankers and lawyers, if a proposed deal handing senior creditors control of the utility goes through, the Financial Times reported on Wednesday, citing a creditor submission.
Financial Breakdown of the Proposed Deal
Fees and Costs
• Deal would include £160 million in fees to senior creditors and £254 million in other costs
• Thames Water would pay about £285 million in accrued interest to creditors on deal completion, and £50 million in fees owed to other creditors
Investor Funding and Penalties
• The utility would avoid some new penalties over four years in return for £700 million investor funding to improve assets
Equity and Debt Injection
• Creditors would inject £3.35 billion in new equity and provide £3.25 billion in new debt, plus an option to increase debt by £3.3 billion
Commitment Fees and Lender Arrangements
• Thames Water will pay £160 million in commitment fees to lenders backing the £6.55 billion debt package
• Apollo will backstop the entire credit facility and could receive a sum of £160 million, with other creditors taking smaller portions
Strategic and Regulatory Implications
Recapitalisation and Turnaround Plans
• Thames Water reiterated its focus on securing a recapitalisation to restore financial stability, a spokesperson told Reuters, adding that the deal is intended to support and accelerate a turnaround
Future Management and IPO Prospects
• Creditors have proposed a new management plan that could lead to a 2030 IPO
Regulatory Review and Stakeholder Responses
• Ofwat said that it is reviewing the proposals carefully to assess whether they would benefit customers and the environment
• Silver Point and Apollo did not respond to Reuters' requests for comment
Exchange Rate Information
($1 = 0.7469 pounds)
Reporting Credits
(Reporting by Bipasha Dey in Bengaluru, additional reporting by Anusha Shah; Editing by Mrigank Dhaniwala and Sonia Cheema)
