Thames Water faces fresh threat to survival after pensions regulation breach
Thames Water is facing a fresh threat to its survival after breaching pensions regulations, opening up the possibility of a costly probe. The Reading-based business, which could run out of cash as soon as December, missed a statutory deadline at the end of June to value its company pension scheme and is now facing a [...]
Thames Water, a business based in Reading with around 16 million customers, is in danger of collapsing due to a breach of pensions regulations. The company has missed a deadline to value its pension scheme, putting it at risk of an investigation by the Pensions Regulator (TPR). The defined benefit scheme, which has assets worth over £1 billion, is paid out to thousands of retired staff.
Thames Water's statement warns that any investigation or litigation by the TPR could impede its financial resources, affecting returns to equity investors and the investibility and financeability of the company. The firm is fighting for survival, with a near-£20 billion debt pile and only £515 million in cash and access to another £750 million in backup funding, expected to last until the fourth quarter of the year.
A TPR spokesperson stated that they are liaising with scheme trustees to protect members' pensions, but no further comment is available. Thames Water confirmed they have informed the regulator about the missed deadline but have not been notified of any investigation.
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