Australian bank Macquarie has emerged as a major lender to Thames Water’s crisis-struck parent company Kemble.
According to a Times report, Macquarie, which was a part owner of Thames Water until 2017, provided around £130 million in loans to Kemble between 2018 and 2020, representing up to 9% of the company’s total debt pile.
Macquarie’s stewardship of Thames Water between 2006 and 2017 garnered immense scrutiny for loading the London water supplier with billions of pounds in debt, all the while earning lucrative cash dividends.
Kemble has £190 million worth of debts due at the end of April, with creditors comprising a litany of foreign banks including ING, Allied Irish Bank, Bank of China and the Industrial and Commercial Bank of China.
The Thames Water owner conceded last week that it will default on £400 million worth of bonds due to mature in 2026. The company’s total debt pile is estimated at £14 billion.
Its situation worsened when shareholders refused to take part in a £500 million rescue package to help manage debt repayments.
Kemble has pleaded with creditors not to take any immediate action to “provide a stable platform while all options are explored”, but these spiralling debts are likely to lead to a restructuring or even a total collapse.
Creditors, including Macquarie, are likely to have a say in how the restructuring process evolves, meaning the Aussie bank might become a part owner of Thames Water once again.