THAMES WATER CREDITORS PLAN 1 BILLION POUND LIFELINE – Hedge funds groups and institutions say company needs a stop-gap cash infusion

It is being reported that creditors of Britain’s largest water provider Thames Water are planning to inject more than 1 billion pounds into the utility before the end of the year.

A group of hedge funds and institutions holding about 10 billion pounds of Thames’ debt believe it needs a stop-gap cash infusion to stabilise the company before it heads for a full restructuring, which may not be completed until the end of next June.

The financing would most likely be in the form of loans or bonds with “super senior status” and would charge a high rate of interest, the report said, adding that the status would mean that the lenders would be first to be repaid if the company failed.

The company said on Friday that it was in crunch talks with creditors about securing funds to keep it going for the next few months while it seeks to raise the billions of pounds of capital it needs to survive.

The group has net debt of 15 billion pounds and said it had 1.57 billion pounds of liquidity on Aug. 31.

The company has been teetering on the brink of collapse since its investors called the company “uninvestable” in March, blaming the regulator for not allowing it to increase water bills sufficiently.