The Government has engaged insolvency specialists to prepare for the possibility that Thames Water, Britain’s largest water company, could collapse, according to press reports.
FTI Consulting is said to have been appointed as a potential administrator if the company fails to secure the funding it needs from lenders.
Contingency plans include placing Thames Water into a special administration regime, an insolvency process designed to manage critical utilities, but this would require court approval.
Environment Secretary Steve Reed authorised the move, emphasising that while Thames Water remains financially stable, the Government is preparing for all outcomes.
Thames Water, serving 16 million customers, is still in talks with senior creditors over a rescue funding deal. However, recent doubts have emerged about the likelihood of completing these refinancing plans, raising the possibility of a state intervention.
The company has acknowledged it remains in “crisis mode” and posted a pre-tax loss of £1.65 billion for the year ending March, with net debt reaching £17.7 billion.
Private equity firm KKR recently withdrew from a planned £4 billion cash injection. Thames Water says it continues to pursue a market-led recapitalisation aimed at restoring financial stability.