London restricts water as company tries to raise US$150 million amid leaks and sewage row
- Extreme heat led to drought across England and Wales, with just 17 per cent of the average rainfall for the period – water restrictions have been implemented
- Thames Water, owned by private investors including some from Canada, Abu Dhabi and China, is taking bids for a private debt package this week
Thames Water Utilities is looking to raise at least another US$150 million (£127 million) from the private debt markets, according to people familiar with the matter, as the company comes under pressure to fix leaky pipes and prevent sewage from flowing into rivers.
London’s water supplier is taking bids from institutional investors this week for a private debt package in some combination of euros, dollars and pounds, said the people, who aren’t authorised to talk about it and asked not to be identified.
Extreme heat over the summer has led to an official drought across England and Wales. Southern England reported its driest July on record, based on the weather provider’s data going back to 1836, with just 17 per cent of the average rainfall for the period. Thames Water is implementing a hosepipe ban from this morning that will place restrictions on families wanting to water their gardens or wash their cars.
The company was also criticised this week after sewage leaked into a river in Swindon. Its record on pollution “requires significant improvement”, the Environment Agency said last month.
Public anger toward Britain’s privatised water utilities could prompt debt investors to demand higher yields from the businesses, which typically issue public bonds after the summer. This may encourage water companies to opt for private debt, which offers less volatile pricing for borrowers.