CPP IS A SHAREHOLDER

Thames Water shareholders to inject £1.5bn as part of business overhaul

todayuknews

Thames Water shareholders will inject as much as £1.5bn into the company as the UK’s biggest water utility seeks to accelerate a shake-up of its business amid regulatory scrutiny over its treatment of sewage.

Investors will provide an initial £500mn of new equity during this financial year, the group said, which serves almost a quarter of the UK population with water and wastewater services. Thames Water is working with investors on plans to provide a further £1bn of equity.

“[The funding] will be subject to certain conditions, to drive Thames Water’s turnaround over the remainder of the current regulatory period, and establish a solid foundation for Thames Water’s long-term growth,” the water utility said on Thursday.

Ofwat, the industry watchdog, raised “serious concerns” in March over the sector’s treatment of sewage. The regulator said it is pursuing “enforcement action” against Thames Water and four other groups.

“We have made good progress in fixing the basics and tackling the structural challenges in our business as well as laying the foundations for our long-term recovery,” said chief executive Sarah Bentley.

Thames Water has approved an £11.5bn business plan for the period ending March 31 2025, which aims to improve outcomes for customers, and tackle leakage and river health.

The latest plan includes a £2bn increase in expenditure from the £9.6bn that was previously allocated. Thames Water launched an overhaul of its business in March 2021.

A detailed three-year analysis that came to light in October showed Thames Water illegally discharged the equivalent of two years’ worth of untreated sewage into rivers.

Thames Water/utilities:

investors tapped for cash after

deluge of complaints

todayuknews

Removing the dead hand of the Treasury was meant to boost investment in the water companies privatised in 1989. But after an initial surge, investment slumped as owners engineered lavish returns. That sowed the seeds of operational and financial problems in parts of the sector. As anger mounts over sewage discharges into rivers, investors are now being asked to shore up strained balance sheets.

On Thursday, the UK’s biggest water company Thames Water announced it was raising as much as £1.5bn in extra capital from investors, including the UK’s biggest private pension fund USS. Painful but at least all investors participated. When Southern Water received a £1bn emergency equity injection from the Australian infrastructure manager Macquarie last year, existing investors were heavily diluted.

Thames Water is also being pursued by the regulator over its treatment of sewage, after repeated illegal discharges. It is not alone. A majority of wastewater companies in England and Wales now face enforcement action. This week regulator Ofwat added Pennon-owned South West Water to the list.

The frequency of illegal spills might suggest water companies view penalties as simply the cost of doing business. But investors do take the issue seriously. After Ofwat’s move on Pennon was announced, £185mn was wiped from its market value. That is more than six times the maximum fine, which is 10 per cent of relevant revenues.

Significant investment — between £23bn and £80bn — might be needed to cut down on river pollution, says Jefferies. Passed on to customers, that would put bills up between 16 per cent and a third. That would be unacceptable given the cost of living crisis. Companies might have to take some of the strain.

Water investors will get the first inkling of their post-2024 returns after Ofwat publishes its draft methodology next month. JPMorgan expects the allowed cost of equity to be 20-40 basis points lower than the 2019 review. Every 25 basis points of allowed cost of equity is worth 2-3 per cent of earnings per share for quoted companies United Utilities, Severn Trent and Pennon.

Investing in monopolies with inflation-linked revenues has obvious appeal. But mounting public anger over pollution will force the slowpokes to clean up their act. Shareholders should be braced for higher investment and lower returns.

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THATCHER'S PRIVATIZATION 

Put Thames Water into special administration, Lib Dems tell ministers

CANADIAN PENSION; OMERS IS ONE OF THE LARGEST INVESTORS


Sandra Laville and Alex Lawson
Fri, 15 March 2024 

Thames Water this week declined to commit extra funds to a £180m industry-wide initiative to fast-track efforts to reduce sewage pollution.Photograph: Toby Melville/Reuters

Thames Water should be put into special administration by the government and reformed as a public benefit company, the Liberal Democrats have said.

Sarah Olney, the Lib Dems’ Treasury spokesperson, has called in a parliamentary debate for the biggest privatised English water company to be wound up under legislation that has recently been updated by ministers.

It makes the Lib Dems the first mainstream political party to say the struggling company must be taken over to secure water and sewerage services for 15 million people.

Thames Water is seeking a shareholder bailout of £2.5bn to the end of the decade to stay solvent, but it wants Ofwat, the water regulator, to allow it to increase customer bills by 40%, pay higher dividends and face lower fines for pollution in order to secure the shareholder investment.


Olney said in parliament: “Thames Water is no longer a functioning company and the government has a choice: either bail them out with taxpayer money or listen to our calls to put them into special administration to then be reformed into a company for the public benefit.”

Thames Water declined to commit extra funds this week to a £180m industry-wide initiative to fast-track efforts to reduce sewage pollution in England’s waterways. Its parent company has been told by its auditors that it could run out of money by April if shareholders do not inject more cash into the company. It needs to repay a £190m loan due in April.

Special administration can be triggered if a company cannot pay its debts or is not performing its statutory requirements.

“The final straw was this week, when Thames Water bosses refused to stump up the cash for new sewage investments,” said Olney. “It was shocking that Conservative ministers just let them get away with it.”

The government is drawing up an emergency plan, known as Project Timber, in the event of the collapse of Thames Water. But Olney said ministers must use their recently updated water insolvency legislation to put the company into special administration.

This can be triggered by the secretary of state or Ofwat. Olney said with the company unable to pay its debts, and recusing itself from new sewage investments, the threshold for special administration had been met.

Under the updated water insolvency legislation the company can be taken over as a going concern to make sure that water and wastewater services continue for 15 million people. The taxpayer would not be liable for the debts, which would stay with the holding company, according to independent analysis of the updated legislation by the House of Commons library.

Olney said the company, once in special administration, could be reformed as a public benefit company, where “profit is no longer put above environmental goals”.

Olney asked the government to provide details of Project Timber. In response, Mark Spencer refused to comment specifically on Thames Water, citing “market sensitivities around private companies”. The environment minister said “the government does have a plan” to support companies in essential services such as utilities or banking “in moments of distress”.

He said: “The government’s priority is the ongoing provision of water and wastewater services.”

Thames Water admits in its latest business plan, which has been submitted to Ofwat for approval, that it has overseen the “sweating of assets” and allowed its infrastructure to decline over decades because it has stretched the life of the assets, repairing rather than replacing.

It is promising to invest £4.7bn to tackle the decline of its infrastructure but says to fully repair its sewers would cost £1.5bn and its sewage works £2.2bn. Thames says it will not be able to deliver the full extent of the investment into its ageing assets nor meet the environmental obligations it had wanted to meet by the end of the decade.

The company is also under investigation by Ofwat and the Environment Agency for suspected illegal sewage discharges from many of its treatment works. The Ofwat investigation, which is due to report within months, could impose multimillion-pound fines on Thames. The company admits that 157 treatment works are non-compliant.

Thames Water declined to comment.

A government spokesperson said: “Water companies are commercial entities and we do not comment on the financial situation of specific companies as it would not be appropriate. We prepare for a range of scenarios across our regulated industries – including water – as any responsible government would.”

Australia’s Macquarie among lenders to Thames Water’s parent company


Julia Kollewe

THE GUARDIAN
9 April 2024·

Thames Water’s shareholders refused to stump up £500m as promised at the end of March.

Photograph: Toby Melville/Reuters

The Australian investment bank Macquarie, which has been criticised for its role in the privatisation of England’s water industry, is understood be among lenders to Thames Water’s troubled parent company.

The former Thames Water shareholder could, along with other lenders, play an important role in determining the fate of Britain’s biggest water company, after its parent company Kemble Water Finance defaulted on its debt.

Kemble said on Friday it had requested that its lenders and bondholders take no creditor action, but the development raised the prospect that the utility could face a significant restructure or even ultimately collapse.

Related: Thames Water funding crisis: the key players in the row over its future

Macquarie’s fresh involvement, first reported by the Times, is likely to spark further controversy, after the Australian group came under fire for loading Thames Water with debt and inadequate investment while receiving big dividends during its part-ownership between 2006 and 2017.

Macquarie has defended its stewardship of the utility, arguing that it invested more than £11bn in Thames Water’s network during the period, the highest per customer level of all water companies in England and Wales.

It emerged last week that the group of lenders to Kemble also include the Dutch bank ING, Allied Irish Banks (AIB) and the Chinese state-owned Bank of China and Industrial and Commercial Bank of China (ICBC).

Kemble has a £190m loan that is due to be repaid at the end of this month, but the banks are expected to agree an extension. Late last month Thames Water’s shareholders refused to stump up £500m needed by the end of March, some of which was earmarked to pay the Kemble loan.

Macquarie is thought to have invested £130m in Kemble’s debt in 2018 and 2020, equivalent to about 9% of the company’s debt instruments. This is not part of the £190m due later this month.

A spokesperson for Macquarie said: “We manage debt investments on behalf of long-term institutional investors in a range of infrastructure companies, providing long-term financing for essential infrastructure. Macquarie has not had any control or influence over Thames Water’s operating company since 2017.”

Macquarie sold its remaining stake in Thames Water seven years ago. The utility’s debt jumped from £3.4bn to £10.8bn during the Macquarie consortium-led ownership.

The Australian group is known for buying public infrastructure. It can then charge fees, and receive dividends for its part-ownership, as well as enjoy any increase in the asset price. Estimates have put dividends paid for Thames Water during the Australian bank’s 11-year stewardship at £2.7bn.

Days after Macquarie’s sale of its stake was announced in March 2017, Thames Water was hit with a then record fine of £20.3m linked to huge leaks of untreated sewage for offences in 2013 and 2014.

 

Thames Water Debacle: A Lesson in Regulation and Utility Mismanagement

By Leonard Hyman & William Tilles - Apr 02, 2024

• Thames Water, the biggest water utility in the UK, was privatized in the last days of the Thatcher regime.
• 
  
• Thames Water fell into the hands of private equity investors who borrowed heavily to buy Thames.
• 
  
• At the most basic level, a utility has to do three things: raise money at reasonable rates, build large public-serving projects and lastly, to operate these projects effectively.
• 
  

The big Cambridge-Oxford boat race on the Thames is the posh British equivalent of March Madness. But there was a big problem this year. The Thames is polluted. The oarsmen had to propel themselves in a sea of e. coli. Unlike the citizens of Flint, MI, who had to face years of polluted water, the oarsmen had a choice. They didn’t have to row. But we are not writing about water equity. This is about utility regulation, and how Americans got something right.

Thames Water, the biggest water utility in the UK, was privatized in the last days of the Thatcher regime. The water utilities in the UK at that time faced enormous capital expenditures to bring water supply and waterway pollution up to European standards. The Thatcherites felt it was better to put this financial burden on private suppliers and consumers rather than on the government. These newly privatized utilities would be expected to run more efficiently anyway, and a competitive water market would develop to discipline prices—at least that was the theory. The privatizers ignored a key aspect of the water business. Like other utilities it is extremely capital intensive. This means that cost of capital, largely variable rate interest expense on a highly leveraged capital structure, is one of the biggest items in the water company budget. When they were first privatized this interest expense number that has cannibalized the expense structure was zero. And private investor capital for what is basically a non-investment grade credit costs a lot more than relatively risk free government bond money.  But that’s not our topic either.

Thames Water fell into the hands of private equity investors who borrowed heavily to buy Thames. They subsequently paid themselves billions in dividends (effectively as repayment and profit) despite Thames Water’s enormous capital spending needs. Those investors now refuse to put more equity into the utility, which may have to declare bankruptcy (whatever the British equivalent). Or heaven forbid, be renationalized. Where were the British regulators during this debacle? We get the impression that they didn’t think it was cricket to interfere in the private business affairs of the owners. American regulators tend to meddle, however, making it difficult to extract too much from the utility. US regulators take the view that the utility needs to stay healthy, financially, in order to serve the public. And they don’t like to leave that to chance. An ailing (or greedy) corporate parent of an otherwise solid utility will look for ways to extract cash. Don’t make it too easy.

At the most basic level, a utility has to do three things: raise money at reasonable rates, build large public-serving projects and lastly, to operate these projects effectively. The inability to do any of these three things is or should be disqualifying to a franchise holder. Thames Water says it cannot raise money at reasonable terms, and one might ask if it has built the necessary projects or managed effectively what it operates. One might even argue that Thames is a “dead man walking”, having mismanaged a relatively low risk business to a point apparently beyond financial repair.

One of these days, Thames Water will be taught as a case study in schools of business and public administration— a lesson in dogmatism, light-handed regulation, and lack of common sense. Maybe we should be grateful for our clunky US regulators and seemingly inefficient government utilities for plodding along and doing their jobs. Remember, the tortoise won the race.

By Leonard Hyman and William Tilles for Oilprice.com

The Privatization of Water Is a Scam

BY PREM SIKKA

07.22.2023

British water companies have loaded up with debt while pumping sewage into waterways, raising bills and delivering huge profits to shareholders. This can only end by the government taking water back from these corporations.

An aerial view shows the Thames Water Long Reach water treatment facility on the banks of the Thames estuary in Dartford, east of London, on March 3, 2023. (Ben Stansall / AFP via Getty Images)

The neoliberal obsession with privatizing essential industries and services is haunting the UK. Profiteering by gas, oil, railways, mail, and other entities is the root cause of the current high inflation and misery for millions. The water industry has been hoisted by its own profiteering, and Thames Water, England’s largest water and sewage business, is teetering on the edge.

The seeds of destruction were sown by the 1989 privatization. The government sold water entities in England and Wales for a meagre £6.1 billion. In the absence of parallel water and sewage pipes, competition isn’t possible, and companies have captive customers.

The industry has adopted the classic private equity business model. Its key elements are high prices, low investment, and financial engineering to extract high returns. Instead of shareholders making long-term investment through equity, the business model uses debt because interest payments qualify for tax relief — effectively a public subsidy. This reduces the cost of capital and increases returns to shareholders, but also increases vulnerability to interest rate hikes.
Minimum Investment, Maximum Profits

Since 1989, water charges have increased by 40 percent in real terms. Companies seem to have a profit margin of 38 percent, a very high percentage for a no-competition, low-risk business whose raw material virtually falls out of thin air.

Some 2.4 billion liters of water are lost every day to leaks due to poor infrastructure. Despite the population growing by nearly ten million, no new reservoirs have been built. Water companies are required to provide clean water but have actually increased contamination by dumping sewage into rivers. Unplugged leaks and sewage dumping increase profits, dividends, and performance-related executive pay.

A report from the House of Lords estimated that the industry needs between £240 billion and £260 billion of new investment by 2050, compared to £56 billion suggested by the government. However, the industry has been focused on cash extraction. It has paid out £72 billion in dividends since privatization and is expected to pay another £15 billion by 2030. It has debts of around £60 billion. Of each £1 paid to the industry, 38p is earmarked as profit. Out of this 20p services debt, 15p is taken by dividends and 3p for things such as tax.

The focus on investment and efficiency has been low. The industry assumed that it could carry on borrowing at low cost forever. Household bills are inflated to cover the cost of borrowing, which would not be necessary if the regulator, the Water Services Regulation Authority (Ofwat), had insisted on prudent practices.

There is the usual story of regulatory capture or at least cognitive alignment. Around two-thirds of England’s biggest water companies employ key executives who previously worked at Ofwat. Six of England’s nine water and sewerage companies have hired directors of corporate strategy or heads of regulation who previously worked at Ofwat.

For years, red flags have been publicly raised about financial engineering at water companies. In 2018, Ofwat suggested that “gearing” or the debt ratio at water companies should not exceed 60 percent (there is a complex calculation), but companies have resisted that.

Years of regulatory indulgence have been given visibility by the crisis at Thames Water. Thames loses around 630 million liters of water a day in leaks and routinely dumps tons of raw sewage in rivers. Since 2010, it has been sanctioned ninety-two times for failures and has been fined £163 million. Over the last three years, the salary of its recently resigned chief executive doubled.

Since privatization, it has paid £7.2 billion in dividends and has debts of £14.3 billion secured against £17.9 billion of regulated operating assets. In common with other water companies, it has used index-linked bonds for its borrowing, meaning that interest payments rise as general rates of interest increase.

Thames is partly owned by state entities from China and Abu Dhabi, and Ofwat seems to have had no success in securing prudent conduct from its foreign shareholders. Thames Water has a debt ratio of around 80 percent, against the Ofwat recommendation of 60 percent. Auditors PricewaterhouseCoopers routinely gave the company a clean bill of health even though it lacked financial resilience. As the Bank of England increased interest rates, Thames found that it could not make the minimalist required investment and service its debt.

The distress at Thames Water is due to the failure of privatization, profiteering, financial engineering, and customer exploitation. Auditors have been silent. The City of London didn’t care much, and Ofwat has done little to check predatory practices. Interestingly, Cathryn Ross, the current joint chief executive of Thames, is a former head of Ofwat. Its director of regulatory policy and investigations and director of regulatory strategy and innovation are also former Ofwat executives.
Ending the Scandal

There is public clamor for the renationalization of water. However, the Conservative government is unlikely to do that. In 2020, during his campaign to become leader of the Labour Party, Keir Starmer promised to bring the water industry into public ownership but has since reneged. Leaked emails suggest that Labour leadership and water companies have secretly been discussing the possibility of forming “social purpose” companies that would stay in private hands but give greater weight to the needs of customers, staff, and the environment.

Section 172 of the Companies Act 2006 requires company directors to have regard for the interests of “employees,” ‘‘customers,” and “the community and the environment” in making decisions. Water company directors have shown little regard for that duty. The woolly concept of “social purpose” is unlikely to curb rapacious practices.

The toxic influence of shareholders and the dash for maximum returns needs to be checked by public ownership and customer empowerment. Water company shares would be practically worthless if environmental and customer protection standards were to be rigorously enforced. In the event of default, secured creditors are unlikely to get much, and the government can buy the assets cheaply. The cost can be funded by issuing public bonds to local people with the inducement that in addition to interest payments, bondholders will get discounts on their water bills. In addition, customers should be empowered to vote on executive pay. That will ensure that executives face public scrutiny and will not be rewarded for abusive practices.

CONTRIBUTOR
Prem Sikka is an emeritus professor of accounting at the University of Essex and the University of Sheffield, a Labour member of the House of Lords, and a contributing editor at Left Food Forward.

P3 PUBLIC PENSIONS FUND PRIVATIZATION

OMERS THE ONTARIO MUNICIPAL EMPOYEES PENSION FUND OWNS 30% OF THAMES WATER 

UK’s biggest water supplier plunges into deeper financial crisis

P3;PENSIONS FUND PRIVATIZATION

By AFP
March 28, 2024


City of London: — © AFP

Debt-plagued Thames Water has failed to raise a major cash injection from shareholders, it revealed Thursday, blaming industry regulations that made its rescue plan “uninvestable”.

Britain’s biggest water supplier said in a statement that £500 million ($630-million) of new equity would “not be provided by Thames Water’s shareholders” this month.

The cash represented most of a £750-million funding lifeline agreed with investors in July to stay afloat.

The company on Thursday said it was in talks with industry regulator Ofwat over a plan that is “affordable for customers, deliverable and financeable for Thames Water, as well as investible for equity investors”.

Britain’s domestic Press Association news agency said Ofwat had refused to bow to Thames Water’s demands for concessions, which it said included a 40-percent jump in water bills that would worsen the country’s cost-of-living crisis.

Thames Water is Britain’s biggest water supplier – Copyright AFP SAUL LOEB

Other concessions sought reportedly include an easing in capital spending requirements and leniency over regulatory penalties.

– ‘Pursue all options’ –

“Safeguards are in place to ensure that services to customers are protected regardless of issues faced by shareholders of Thames Water,” said an Ofwat spokesperson.

“Today’s update… means the company must now pursue all options to seek further equity for the business to turn around the performance of the company for customers.”

Thames Water, which supplies more than 15 million homes and businesses in London and elsewhere in southern England, is saddled with debts of almost £15 billion that have placed it at risk of nationalisation.

“We prepare for a range of scenarios across our regulated industries — including water — as any responsible government would,” said a statement Thursday from the Conservative administration led by Prime Minister Rishi Sunak.

Steve Reed, environment spokesman for the main opposition Labour party, said “the government and regulators must do everything in their power to stabilise the company and ensure new investment comes through to fix the broken sewage system without taxpayers being left to foot the bill.”

Labour, widely tipped to win a UK general election this year according to several polls, “will strengthen the regulator’s powers and make financial stability a priority to prevent this situation from happening again” should it win power, Reed added in a statement.

Thames Water has faced fierce criticism over missing targets to reduce leaks and slash sewage discharges into rivers, despite major infrastructure investment.

Environmentalists have increasingly voiced outrage at the rise in pollution on the UK’s beaches and waterways, and have pointed the finger at privatised water companies.

Elsewhere on Thursday, researchers revealed that high levels of E.coli, a bacteria found in human waste, had been found in London’s River Thames.

The river will Saturday host the Oxford and Cambridge Boat Race — an annual event featuring competing rowing crews from England’s two oldest universities.

THAMES WATER SHAREHOLDERS INCLUDE OMERS; 

ONTARIO MUNICIPAL EMPLOYEES RETIREMENT SYSTEM

UK
Thames Water could run out of money by April, auditor warns

James Fitzgerald
Sat, 2 December 2023 

Thames water

Thames Water’s parent company could run out of money by next April if its shareholders don’t inject more equity into the debt-laden utility, its auditors have warned.

The group’s auditors, PricewaterhouseCoopers (PWC), said there is “material uncertainty” about its future because there are no firm arrangements in place to refinance a £190m loan held by one of the company’s subsidiary businesses.

Thames Water is set to face scrutiny over its debt levels and financing structure when its results are published on Tuesday.

Parliament’s Environment, Food and Rural Affairs Committee said it’s considering calling the firm’s executives in to explain whether they misled MPs about the company’s financial situation when they gave evidence in the summer.

The panel’s chair, Conservative MP Robert Goodwill, said on Friday: “Recent revelations of Thames Water’s financial situation raise further concerns about the stability of the company’s finances.”

In June, the water company entered emergency talks with the water regulator Ofwat, ministers and government departments after the exit of its chief executive and concerns over its ability to continue operating without a multibillion cash injection.

At the time, regulators suggested the company could be facing a hole of £10bn in its finances.

The business also faces breaching an interest cover covenant on a separate £200m loan by the same date “under a severe but plausible downside scenario,” PWC said. The disclosure was made in the 2022-23 accounts of Kemble Water Holdings, the top company in Thames’ ownership structure.

Thames Water shareholders have pledged to support the company, with a commitment in writing to inject £750m of further equity into the group. But PWC said that “the letter is not legally binding and there are no other firm commitments to refinance the £190m loan”.

In October, Ofwat said the firm had ‘significant issues’ to address. A spokesman said: “Thames Water must address their operational shortcomings and strengthen their financial resilience.”

The regulator has indicated that shareholders will need to put another £2.5bn into the business between 2025 and 2030.

A Thames Water Utilities Limited spokesman said: “We are in a robust financial position and are extremely fortunate to have such supportive shareholders”.

Two Canadian pension plans risk reputation hit from investments in troubled Thames Water
U.K. utility fiasco plunges OMERS and BCI into the midst of potential rescue plan

LA REVUE GAUCHE - Left Comment: Search results for THAMES WATER 

Thames Water Crisis Fragments Industry’s $60 Billion Bond Market

LARGEST INVESTOR IS CANADA'S OMERS PENSION FUND

Tasos Vossos
Fri, July 14, 2023 


(Bloomberg) -- The crisis at Thames Water Ltd. has left the $60 billion market for UK water utility bonds deeply divided.

A measure of the dispersion in spreads in the sector has surged over the past few weeks as investors try to separate companies they see as well run, with manageable debt loads, from those that face the most operational and balance sheet issues. The standard deviation almost tripled after reports of a possible temporary nationalization of Thames Water, before settling at around double typical levels, according to data compiled by Bloomberg.

“Going forward we should see more differentiation in spread terms among various water companies, driven by an increasing focus on operational performance, gearing and amount of inflation linked debt,” said Kshitij Sinha, a portfolio manager at Canada Life Asset Management.

Bonds issued by Southern Water Ltd. and the holding company of Anglian Water — along with Thames Water’s Kemble bonds — saw the biggest spread widening over the past few weeks. Debt issued by Severn Trent Plc had one of the mildest reactions, with only a single-digit increase in the risk premium.

Representatives at Thames Water and Anglian Water didn’t respond to requests for comment. A representative at Severn Trent said they had no comment to add, while a spokesperson for Southern Water also declined to comment on bond spreads.

Thames Water has been engulfed in a crisis as it’s had to borrow more to fund investments in its ailing infrastructure, while soaring inflation in the UK has driven up the cost of servicing its £8 billion ($10.5 billion) of index-linked debt. The company — which serves about a quarter of the UK population — said this week that it is confident of raising further funds after investors agreed to a £750 million equity injection, but UK regulator Ofwat said that there are still “significant issues” to deal with.

And in a sign of industry issues going beyond Thames Water, Southern Water was downgraded by Fitch Ratings last week, triggering clauses in bond documents that forced it to suspend dividend payments.

To be sure, avoiding losses in water company bonds since Thames Water made the headlines in late June would have been difficult, with spreads on the vast majority of issuers widening, based on data compiled by Bloomberg.


Still, the dispersion indicates that investors are starting to pick which companies they see as winners and losers in the group.

“Investors are not going to abandon the sector: these companies are still high-quality, offering attractive returns,” said Canada Life’s Sinha. “However, spreads will start reflecting the risk in the sector, penalizing the constant underperformers.”

Most Read from Bloomberg Businessweek

JUNK BONDS

Traders Pile Into Cheap Thames Water Bonds on Restructuring Bet

Tasos Vossos, Neil Callanan and Abhinav Ramnarayan
Thu, April 11, 2024





(Bloomberg) -- Money managers are buying up Thames Water bonds that are trading well below their face value, betting that any haircut from a potential restructuring will prove less painful than current trading levels indicate, according to people with knowledge of the matter.

The wager sees investors buy the operating company’s lowest-priced top-tier bonds, which trade at a discount of about 20% or more to the issuance price because of their lower coupon, the people said, asking not to be named. The popularity of the trade has helped the bonds outperform their higher-price counterparts in recent days.

To hedge against the bet not paying off, some investors are also short selling bonds that trade close to face value, the people said.

Holders of Thames Water’s £16 billion ($20.1 billion) of debt are bracing for a potential haircut after the firm’s parent company, Kemble Water Holdings Ltd, defaulted last week. The government is resisting pressure to bring the UK’s biggest water company into special administration, but creditors are concerned that some kind of restructuring is becoming more likely amid a deepening standoff between Thames shareholders and the water regulator Ofwat.

Special administration, a form of temporary nationalization, would likely lead to a debt reorganization which could see senior bondholders having to take a haircut, analysts at CreditSights wrote in a note on Tuesday.

“We have, in the last few weeks, moved some of the higher cash price bonds into lower cash price bonds from a prudent risk management perspective,” said Luke Hickmore, a portfolio manager at Abrdn Investment Management Ltd. His base case is that Thames Water will eventually receive an equity injection.

Short interest has risen sharply in three high-price Thames Water bonds, an indicator of the size of bets against them. In one case, involving a bond maturing in 2028, the wagers now amount to almost 18.5% of the percentage value at issuance, compared to 1.26% at the start of the year, according to data compiled by S&P Global Market Intelligence. By contrast, bets against three low-price bonds remain below 1.4%.

Companies with large amounts of debt often have bonds with wildly differing cash prices because notes are issued over multiple years at different points in the rate cycle. The average coupon size on the lower-price Thames bonds is about 200 basis points below that of the firm’s other debt.

This disparity can become a trading opportunity when an unexpected redemption occurs. In the case of Thames Water, investors are betting that bonds will be redeemed at around 70-85 cents per pound if the company is placed under special administration. This makes any bonds with a cash price below that look attractive, and anything above look expensive. A 100 basis point gap has opened up between the valuations of the two groups of bonds in recent days.

Thames Water’s parent company, Kemble Water Finance Limited, defaulted on about £1.4 billion ($1.8 billion) of debt last week after shareholders refused to provide £500 million of fresh equity. Tight legal and regulatory frameworks mean Thames Water can operate on its own, but a group of creditors at the operating company have hired advisors for help on potential restructuring talks anyway.

CreditSights analysts Helen Rodriguez and Andrew Moulder outlined six different scenarios for the saga at Thames Water, ranging from an eventual equity injection to a break-up of the business. Bloomberg Intelligence analyst Paul Vickars wrote in a note last week that the firm may require a haircut of at least 20% on its Class A debt to comply with Ofwat’s regulations.

--With assistance from Laura Benitez.

Most Read from Bloomberg Businessweek

Thames Water faces sink or swim moment as debt crisis deepens

ONTARIO PENSION FUND OMERS IS INVESTOR

Michael Bow
Sun, 28 January 2024 

Thames Water serves 15 million households - Jose Sarmento Matos/Bloomberg

A key portion of Thames Water’s £14bn debt pile has crashed to a record new low in the clearest sign yet that investors are abandoning the embattled group.

Fund managers who own Thames debt have been dumping some of its riskiest IOUs in recent days over fears the company could fail to repay the debts.

A bond linked to an entity in Thames’ byzantine debt structure has crashed by 20pc in value over the last fortnight. The bond, which is linked to a company called Thames Water (Kemble) Finance, is now worth 40p in the pound, down from a price of 50p. They were worth as much as 87p six months ago.
\
While having no immediate impact on the group, or consumers, the bond market tremors are a sign investors believe that Thames Water could be heading for a further financial squeeze.

“The market is telling you that there is a high probability that these bonds don’t get repaid,” says one investor.

Thames is Britain’s largest water company with 15m customers. But the utility giant has been hamstrung in recent years by its complex debt structure.

It has £14bn of debts against £19bn of equity, according to most recent figures, meaning it has borrowed almost as much as investors have put in. This high leverage makes the company vulnerable to the whims of investors and banks.

Rising interest rates have put intense pressure on Thames as its debt repayment costs have increased rapidly.

Thames Water was handed a £750m lifeline from shareholders in July to stave off nationalisation, but bosses have admitted the company may need £2.5bn between now and 2030 to remain viable. Will it be able to raise the money?

As well as financial concerns, campaigners such as former Undertones frontman Feargal Sharkey have also taken aim at the company over its environmental record.

Figures released last week showed the amount of sewage Thames dumped in London’s rivers rose by nearly five times last year versus 2022.

The gloomy backdrop underscores the challenges facing chairman Sir Adrian Montague and new Thames chief executive Chris Weston.

As the architect of New Labour’s Private Finance Initiatives (PFI) projects in the late 1990s, Sir Adrian helped usher in an era when deep-pocketed private investors ploughed money into public services.

Known as a fixer in Whitehall, Sir Adrian was parachuted into Thames in June to draw on his deep experience balancing the twin demands of the City and Westminster.

His experience will be valuable as Thames faces pressure from regulators, politicians, debtors, shareholders and campaigners alike.

Weston was the former chief executive of Aggreko and is well regarded in City circles for leading the power group successfully for seven years.

In a sign of intent last week, the duo moved to reshuffle a small portion of Thames’ debt mountain.

Chris Weston is charged with clearing some of Thames Water's debt pile - Andrey Rudakov/Bloomberg

The company raised £850m of debt from investors at the same time as buying back £500m of existing debt. Orders for the bond were oversubscribed.

A bond investor said the sudden refinancing showed Thames was trying to get on the “front foot” to build momentum in the market ahead of a difficult year.

“It does show a degree of confidence at the regulated level. If it had not been subscribed to, it would have been a real kick in the teeth,” they said.

Tellingly, the bonds were priced at a more attractive price than they could have been, offering a small discount to the value of other Thames bonds.

TwentyFour Asset Management partner Gordon Shannon said the discount was an attempt to lift some of the gloom over the Thames name.

“Clearly Thames are giving a level of concession because there’s more than a little bit of a stink around the name,” he says.
However, the debt reshuffle is relatively small beer.

Shannon says: “While issuing longer dated debt is helpful at the margin in pushing some of their issues down the road, what Thames really needs is a fresh equity injection.”

Thames has a complex structure, with a regulated operating company called Thames Water Utilities running the network and several companies dubbed Kemble – named after the source of the River Thames – raising money to invest in the network by borrowing from bond markets.

Money flows back from Thames to Kemble but there are concerns about how much will trickle up in future. Ofwat launched a recent investigation into a £37.5m dividend payment that may have flouted regulations.

The bond slide last week signals that markets fear payments to bondholders could be choked off.

With shareholders like USS and OMERS having already ploughed £750m into the group over the summer, the question remains whether they will ride to the rescue once again or throw in the towel. Both groups have written down the value of their stakes in the utility recently. This week’s bond slide may prompt a further reassessment of Thames’ value.

One solution to the crunch may be to sell off some assets, such as the naming and branding rights for “Thames Water”, or to sell off swathes of UK land owned.

Thames licences its logo to companies such as HomeServe, so there also could be scope to make money from a sale. Sir Adrian and Weston will be weighing up how to fix the stink around Thames.

“It’s basically a game of chicken between the Government and the shareholders now on allowed returns versus the need for investment,” says the bondholder.

Thames needs to fix its leaks quickly.

Thames Water’s biggest investor cuts value of its stake to zero

Jillian Ambrose
Fri, 17 May 2024

Thames Water supplies about a quarter of the UK’s population.

Photograph: Dan Kitwood/Getty Images

Thames Water’s biggest investor has slashed the value of its stake in the company to zero in the latest sign of an escalating financial crisis for Britain’s biggest water supplier.

The Canadian pension fund Omers issued a “full writedown” of its 31.7% stake in Thames’s troubled parent company in its annual report published on Friday, signalling that it believes its share is worth nothing.

The latest blow to the water supplier, which serves about a quarter of the UK’s population, marks a precipitous decline for a company that Omers valued at £700m at the end of 2022 and £990m at the end of 2021.

Related: The Guardian view on Britain’s dirty waterways: a failure of industry and regulation | Editorial

Omers signalled that Thames is now worthless a day after Michael McNicholas, a managing director at Omers Infrastructure, quit his role as non-executive director of Thames Water.

The decision to raze the value of Thames has emerged weeks after Omers, and the company’s other shareholders, refused to give the company £500m of emergency funding after branding its business plan “uninvestable”.

Alongside Omers, Thames shareholders include the British university staff pension scheme USS and the BT Pension Scheme manager Hermes. None have taken a dividend from Thames since they bought into the business in 2017.

The water company is now racing to avoid a multibillion-pound taxpayer-backed bailout after its parent company, Kemble, defaulted on its debt, raising fears that the company could face a significant restructure or even collapse.

Thames could be placed into special administration, which would result in the government stepping in and temporarily renationalising the company. This outcome would probably fuel critics of the Conservative government who argue the water company’s plight represents the failure of Margaret Thatcher’s privatisation agenda.

The Guardian revealed last month that under radical plans being drawn up in Whitehall, codenamed Project Timber, ministers would turn Britain’s biggest water company into a publicly owned arm’s-length body.

The plans, overseen by Defra and the Treasury, a new public corporation would be formed to hold the water monopoly, modelled on the company that built the £18.8bn Crossrail project, while Thames’s vast liabilities would be assumed into the government’s debt pile.

The water regulator, Ofwat, is reportedly working on rescue plans for Thames that could lead to the water company’s regional monopoly being dismantled and sold off to neighbouring rival suppliers under a scheme codenamed Project Telford.

Ofwat has tasked the former private equity banker Adrian Williams with overseeing the rescue bid, according to the Telegraph, in a last-ditch attempt to save the company from collapsing under the weight of a more than £15bn debt pile.

Under the plan, Thames could be split into two smaller suppliers: one covering London and the other supplying water services to Thames Valley and Home Countries regions. The company may end up being split up into as many as “a dozen” smaller companies, according to the report.

An Ofwat spokesperson said: “Safeguards are in place to ensure that services to customers are protected, regardless of issues faced by the shareholders.”

The strain on Thames’s finances was laid bare last month in a revised plan submitted by the water company to Ofwat, which revealed that the annual interest bill on its borrowings is expected to rise to about £3bn by 2030.

Thames was privatised in 1989 with no debt. In the decades since the water supplier has taken on more debt to help fund its infrastructure projects while paying large dividends to investors, most notably the Australian investment bank Macquarie.

The government was approached for comment.

UK
Thames Water accused of hiding problems with emergency plant

Emma Gatten
Thu, 4 August 2022

The company's desalination plant is meant to provide water to nearly one million people in case of drought, but will be switched off until at least next year - Jamie Lorriman

The Environment Agency (EA) on Thursday accused Thames Water of hiding problems at its emergency back-up plant that is meant to protect thousands of households from drought.

Thames Water only informed the EA that their desalination plant was not working on July 20, the day after the UK hit a record 40C temperature, Whitehall sources told The Telegraph.

The desalination plant, which was built to provide drinking water to nearly one million people and cost bill payers £250 million, was on Thursday revealed to be switched off despite a looming hosepipe ban across the capital.

But officials threatened regulatory action after the water company earlier this year gave assurances that the plant could be used during shortages in drought plans submitted to the EA.

It comes as the first restrictions will be introduced across Hampshire and the Isle of Wight on Friday with millions of households banned from using their hosepipes, filling paddling pools or switching on their water fountains.

The Met Office on Thursday said there was “very little meaningful rain” forecast for the driest parts of the country in the South East.

Police chiefs warned that encouraging neighbours to report on one another for breaching the hosepipe ban could lead to disorder that will create extra work for the forces.

Questions over the water companies’ management during the drought has developed into a political row, with both Tory leadership candidates vowing to tackle poor performance over leakage.
‘We should not need to rely on hosepipe bans’

The Government is under pressure to get a grip on the looming drought crisis, which could see swathes of the country put under water restrictions.

Labour on Thursday accused the Government of failing to anticipate and plan for an “entirely predictable” crisis.

“In a country with plenty of rain outside of midsummer, we should not need to rely on hosepipe bans to get us through the dry months,” Jim McMahon, the shadow environment secretary said.

The plant in Beckton was built in 2010 to provide drinking water for 900,000 Londoners in case of drought or water shortages. But it has never been run at full capacity and will be switched off until at least next year.

The plant cost bill payers £250 million - Jamie Lorriman

The Environment Agency has told Thames Water to come up with ways to cut more household demand to offset the loss of the plant, and asked it to explain why the plant will be under maintenance for so long.

Failure to maintain the facilities needed for a drought could affect the company’s performance rating.

Government sources on Thursday said it was “baffling” that Thames Water had failed to fix issues at the plant over the last decade.

Sadiq Khan, the London mayor, held talks on Thursday with Thames Water to put pressure on the company to resolve the issues as soon as possible.

“Customers who have paid for this facility expect it to deliver what was promised,” said Karen Gibbs, of the Consumer Council for Water.

Thames Water was approached for comment.

UK

PRIVATIZED WATER COMPANIES
Thames Water boss brands performance ‘unacceptable’ during river quality inquiry

LUKE O'REILLY, PA

13 October 2021, 10:25 am

Thames Waters’ chief executive has branded her own company’s performance as “unacceptable” while taking questions from the river water quality inquiry.

The Environmental Committee (EAC) on Wednesday quizzed bosses from five of the largest water and sewerage companies in England on the issue of river contamination.

It comes following the committee’s inquiry into water quality in rivers, which heard reports of water companies discharging raw sewage into rivers in England more than 400,000 times last year.

The Thames has been badly impacted by wastewater, with millions of tonnes of raw sewage entering the river each year.

Engineers at the back of a boring machine excavating a section of the Thames Tideway Tunnel in London.

Under questioning from EAC chairman Philip Dunne MP, Thames Water chief executive Sarah Bentley admitted that her company’s performance is “unacceptable”.

“Thames (Water’s) performance is unacceptable, our customers find it unacceptable to contact us.

“Our ageing infrastructure, whether that’s on the water side with leakage, or on the sewage network in terms of the capacity we are treating, needs addressing.”

Ms Bentley said that Thames Water has a “broad range” of performance metrics that “need to change”.

“Since I joined 12 months ago I have been accelerating the money that we have got during this regulatory period”, she said.

“When I started I went out, I listened to our customers, I listened to environmental groups and members of this House, and of this committee, and it is clear that we have a broad range of performance metrics that we need to change”.

Ms Bentley also revealed that the new Thames Tideway Tunnel would not be able to eliminate the problem of rainwater spills into the Thames.

The 16-mile long tunnel is projected to cost £4.2bn and is set to be completed by 2025.

“Currently, when we get inundated with rain, up to 39 million tonnes of rainwater, which then gets contaminated with sewage, is discharged into the tidal Thames, which is clearly unacceptable”, she said.

“The Thames Tideway tunnel will eliminate the vast majority of that.

“Clearly, with extreme weather events, that are increasing, we need to look at that before it comes into operation in the next two and a half years.

“But when the original analysis was done 15 years ago, we would have needed a tunnel twice as big.”

Members of Surfers Against Sewage and Thames 21 clean the banks of the river Thames, near Battersea Bridge in south west London, as part of the Surfers Against Sewage 20th anniversary Beach Clean Tour, which has visited 20 major UK beaches and waterside locations (Dominic Lipinski/PA)More

She told the committee that, at its widest, the Thames Tideway tunnel is as wide as three double-decker buses.

“It would need to be twice as big to reduce it down to zero spills”, she said.

“It’s designed to take it from 39 million tonnes down to two and a half million tonnes.”

She said her company was spending £1.2bn over the next five years on improving its overall network to treat sewage and rain.

Ms Bentley said she understood why Thames Water’s customers find spills into the water unacceptable and said that her company’s position is also that they are unacceptable.

“I can understand why people are genuinely upset and concerned about the quality of the rivers and the situation with sewage discharge into those rivers,” she said.

“A number of my colleagues have suggested making sure that we transparently share information about when those spills are occurring.

“More importantly, what I have heard in the year that I have been running Thames is that our customers just find spills unacceptable, and we find them unacceptable and I’m really committed to finding out how we can eliminate storm discharges so that people can swim confidently in the river.”

Previously the EAC heard that just 14% of English rivers are currently rated an ecological status of ‘Good’, and that not one river in the country is rated ‘Good’ on its chemical status.

In a statement the EAC said that one of the main sources for this is sewage discharge from the water industry.

THIRD WORLD UK 

New Thames Water map reveals where raw sewage is being discharged

Andy Gregory
Tue, 24 January 2023

A new map showing where raw sewage is being discharged via storm overflows has highlighted various locations where effluent has been pumped into English waterways for hundreds of hours without pause.

Thames Water launched its digital map earlier this month, providing real-time data on its discharges across the South East, amid growing public anger about the state of the country’s rivers.

There has been a 29-fold increase in untreated sewage discharges into rivers and seas over a period of five years, Environment Agency figures obtained via freedom of information requests revealed last August.

A sewage overflow outlet discharges into the River Thames in November (Getty Images)

Further analysis of the agency’s data – which showed raw sewage had been pumped into British waterways for a total of 9,427,355 hours since 2016 – showed that nearly one in four discharges went unmonitored the previous year.

Following sustained pressure from campaigners and growing public anger, the government and regulator Ofwat have sought to crack down on water companies’ ability to pollute rivers and seas.

Under the government’s Environment Act, water companies have been told to make near real-time data about the frequency and duration of all storm overflow discharges available to the public no later than 2025 – and ministers have said that all overflows will have monitors fitted by the year’s end.

Thames Water, England’s largest private water firm, became the first company to launch an interactive map providing real-time information on raw sewage discharges into inland waterways.

The map shows continuous flows of effluent lasting for hundreds of hours in some locations.

As of Monday at 9pm, sewage had been flowing for 554 hours at Clanfield and 564 hours at Standlake, both in Oxfordshire, for 839 hours in Burghfield and 841 in Stratfield Mortimer, both in West Berkshire, and for 758 hours in Fairford, Gloucestershire, among other locations.

Public consciousness about the scale of Thames Water’s raw sewage discharges via storm overflows has risen sharply since the company this month launched its digital map identifying discharges as they take place.

Ash Smith, a retired police detective and water activist from the Oxfordshire group Windrush Against Sewage Pollution, said that although the interest generated by the new map has been “remarkable”, ultimately “nothing has changed”.

Thames Water’s map: Locations in red represent ongoing sewage flows, while those in orange have stopped within the last 48 hours (Thames Water)

“It has created a lot of interest in what is happening, it’s been remarkable,” Mr Smith told The Guardian. It should put pressure on the more opaque water companies to do the same. But nothing has changed, the rivers are still being used as a toilet.”

Thames Water told the paper: “Our current investment programme, which is fully funded, will deliver major increases in treatment capacity at many of our sites.”

It added: “We are absolutely committed to protecting and enhancing our rivers and the communities who love them, and we want to make these discharges of diluted sewage unnecessary as quickly as possible.

“We are the first company to provide these alerts for inland waters … We want to lead the way with this transparent approach to data, and the alerts will be available through an open data platform for third parties, such as swimming and environmental groups, to use.”

The chart below sets out the ownership of Thames Water 

Our external shareholders

Ontario Municipal Employees Retirement System 31.777% One of Canada’s largest pension plans, with C$105 billion of net assets and global experience managing essential infrastructure 2017-2018

Universities Superannuation Scheme 19.711% A UK pension scheme for the academic staff of UK universities 2017, 2021

Infinity Investments SA 9.900% A subsidiary of the Abu Dhabi Investment Authority and one of the world’s largest sovereign wealth funds 2011

British Columbia Investment Management Corporation 8.706% An investment management services provider for British Columbia’s public sector 2006

Hermes GPE 8.699% One of Europe’s leading independent specialists in global private markets and manager of the BT Pension Scheme (BTPS), one of the largest UK pension schemes for the private sector 2012

China Investment Corporation 8.688% One of the world’s largest sovereign wealth funds 2012

Queensland Investment Corporation 5.352% A global diversified alternative investment firm and one of the largest institutional investment managers in Australia 2006

Aquila GP Inc. 4.995% A leading infrastructure management firm and a wholly owned subsidiary of Fiera Infrastructure Inc., a leading investor across all subsectors of the infrastructure asset class 2013

Stichting Pensioenfonds Zorg en Welzijn 2.172% A pension fund service provider managing several different pension funds as well as affiliated employers and their employees 2006

#P3 WATER IS LIFE NOT FOR PROFIT

Australia’s Macquarie buys £1bn majority stake in Southern Water

Aug 10, 2021 | News

The Australian investment bank Macquarie has returned to the UK water industry – four and a half years after leaving Thames Water saddled with debt – buying a majority stake in Southern Water for more than £1bn.

The infrastructure investor promised to put the utility firm “back on a stable footing” after it was fined a record £90m last month for dumping billions of litres of raw sewage off the north Kent and Hampshire coasts.

An investigation found that Southern Water had deliberately poured the sewage into the sea to avoid financial penalties and the cost of upgrading and maintaining infrastructure.

The company is responsible for supplying water to 2.6m customers and provides wastewater services to 4.7m customers across Kent, Sussex, Hampshire and the Isle of Wight.

Macquarie said that by injecting more than £1bn in new equity to recapitalise the business, Southern would be able to invest in fixing the faulty pipes, pumping stations and sewers, which are causing harm to the local environment.

Ian McAulay, the chief executive of Southern Water, said Macquarie’s investment was “good news for our customers, the local environment and the regional economy”.

“It strengthens our ability to tackle the longer-term challenges posed by climate change and population growth, at the same time as being responsible custodians of Southern England’s rivers and seas,” he said.


The bank sold its stake in Britain’s biggest water supplier, Thames Water, in 2017 after a decade in which Macquarie earned billions from the company through dividends and paid next to no corporation tax.

Macquarie sold its final stake in Thames for an estimated £1.35bn, just months before the Environment Agency prosecuted the utility company for extensive pollution in the Thames and other rivers between 2012 and 2014. At the time the £20m fine was a record for such this kind of offence.

In a letter published on Monday, Ofwat, the water industry regulator, warned Macquarie that “very profound changes” would be required at Southern Water.

Jonson Cox, Ofwat’s chair, added that the water industry had made strides in recent years to bring investor returns in line with customer service and eliminate complicated corporate structures and financial arrangements. Macquarie used such mechanisms to load Thames with debt to pay hefty dividends and no tax.

“You have confirmed that you support these aims,” Cox said. “You have recognised that Southern Water’s customers deserve better service, and you have set out your ambition for Southern Water to be a well-performing business in the next regulatory period and for the company to be able to operate in line with Ofwat’s expectations for the whole sector.”

On Saturday, an incident involving a Southern water overflow prompted Canterbury council to warn the public not to swim off a section of the Kent coast near Whitstable.

Leigh Harrison, the head of Macquarie’s infrastructure division, said its long-term investment in the company would put Southern “back on a stable footing” and enable “an ambitious multi-year transformation plan” to make the company more sustainable and resilient.

In response to Ofwat’s letter, Harrison said that while Southern should make “substantial progress in addressing its issues by the end of 2025”, the full transformation “will take time”.

The public outcry prompted by Thames’s track record under Macquarie’s ownership was one of the key drivers behind calls for the regional water company monopolies to be taken back into public ownership, which was a Labour party manifesto pledge for the 2019 election.

Pascale Robinson from We Own It, which campaigns against private ownership, said Macquarie’s previous ownership of Thames set “a worrying precedent” for its ownership of Southern Water.

“Macquarie may be promising to use their stake to stop sewage leaks but we can’t trust them to be true to their word, given that they were responsible for Thames Water’s extensive pollution of the Thames in 2014-16,” he said. “To stop the rip-off that is private companies profiting off a basic human necessity, and to hold Southern Water to account, we need to bring water back into public ownership throughout the UK.”


Source: The Guardian