Thames Water had feared it might be left with just £39mn cash by month-end

Unlock the editor’s digest in free

FT editor Raula Khalaf selected his favorite stories in this weekly newsletter.

Thames Water has faced a cash crunch with its own recent forecast that predicts that it may be less than $ 39 million at the end of the month, as suppliers also raise their demands to pay immediate payment.

The Tutoring of water utility Up to $ 3 billion emergency LOAN agreed from its seniors, but it could not start access to money at least in early April.

Deadly cash estimates from internal documents this month have been updated in the stem that implies that, except for the new Loan, the cash balance of Thames Water may be reduced to $ 39 million at the end of March.

It leaves Thames Water, which serves 1mm millions of people across London and Thames Valley, shakes to waive previous restrictions on LOAN -Access to ND Emergency Fund There is pending.

The Thames Water also submitted evidence to the court of the court last month that a “updated cash flow forecast” a “significant drop” forecast for the final week of March “only at $ 39 million available in cash”. The swearing statement describes this layer as insufficient in liquidity.

However, the recent cash projection of Thames Water has predicted that according to a person familiar with utility money, the company will be about $ 120 million at the end of the month.

That level of cash described will still be below a original £ 200 million dollars that the court had heard that Thames Water considered as a safe liquidity buffer. Utility, which was the largest water agency in the UK, was £ 1.1bn in its balance sheet recently as September.

Thames Water Chief Financial Officer Alastar Kochran told the London High Court last month that utilities often felt “unexpected fluctuations in the executive capital”, which made $ 200 million suggesting “minimum cash fluid buffer”.

Thames Water said in a statement on Friday: “We continue to work closely with our creditors and today based on our fluency position and the management of the prudent business, we are sure we have been able to manage our business without interruption and hope to access extra fluid when needed.”

“We have recently updated the interest in our equity rise process and the view of the market -led solution is in the best interest in the market, the UK taxpayers and the greater economy.”

Cash crunch the largest water agency crisis in the UK. Thames Water is crying below about $ 20 billion, a public reaction Hikes enough billsAnd in 1989, the utilities in England are trying to become the first water bodies for rebuilding as privatized.

According to people with direct knowledge of its supply chain, the nervous suppliers have also extended their cash crunch to more strict conditions.

People have added, the London-list power suppliers Drax Group is among the companies that are asked to pay every two weeks than the period of 30 to 60 days.

Except for Drax, other companies, from the IT system supplier to chemical suppliers, are also seeking more favorable conditions, according to close people of the company. According to a person near Thames Water, this is especially the case with the big international organizations “which are in crisis that have strict rules about doing business with companies”.

Drax refused to comment.

Thames Water had earlier said that it would be out of cash on March 25, but on this date, the $ £ 200 million was able to increase the loan payment within two years. Nevertheless, its senior executives have testified in the court last month that the utility will be left in a dangerous position without being able to access new funds.

Andy Freser, general consultant of Thames Water, said at a court hearing last month that the utility with the suspension of LOAN could “be effective in steam for several weeks” without fresh fluidity.

Fraser added that the management of Thames Water tried to confirm that they “actually do not reach the place where we are running near zero”, describing it as “a very dangerous place to take the company.”

Despite the decline in cash balance, senior management of Thames Water believes that it can still avoid being devastated in the government’s special administration system, under which it will be temporarily renewed, as ND donors may agree to access their new cash on March 7th.

In a special administration, the UK government will take action in Thames Water and backstop, ensuring that services will be running and providing timely to the supplier and employees. The interest of the debt will be frozen, freeing extra cash to spend the infrastructure.

Thames Water will instantly pay about $ 20 million to $ 318 million It will be drawn to its top credits from the emergency loan, which includes Our Hedge Funds Eliot Management According to people familiar with recent financial assumptions in Thames Water and Silver Point.

Thames Water last month revealed that it was already paying at least $ 15 million on consultative fees for creditors and legal expenditures, which is expected to increase if the Supreme Court is contested in the Supreme Court. The junior creditors standing for considerable harm under this agreement are waiting for a full verdict by the Appellate court before deciding whether the verdicts should be challenged.

Thames Water has argued that Loan is required to provide a bridge to provide a bridge to allow new investors to increase the new equity from new investors. It has announced this week that it has received Six initial bids In this process, which it expects to agree in June.

Data Visualization by Clara Mare London