Thames Water seeks creditor consent to unlock further £615M of additional super-senior funding

Thames Water has launched a new round of creditor consent and waiver requests as it seeks to unlock more than £600 million in additional liquidity under its existing super-senior financing structure, the latest step in the beleaguered utility’s efforts to stabilise its finances while pursuing a broader restructuring.

The company confirmed that it has secured commitments of £823 million under the “Accordion” mechanism attached to its £1.5 billion super-senior facility, bringing the total amount of available and undeferred funding under the structure to £2.25 billion when combined with the original facility. Thames Water has already drawn £1.426 billion of the initial super-senior financing.

The newly-committed funding consists of the first £750 million tranche of the Accordion facility together with approximately £73 million representing a shortfall allocation. Access to those funds remains subject to various conditions precedent, several of which have not yet been satisfied or waived, including requirements tied to a supported lock-up agreement in relation to the company’s wider restructuring plan.

To bridge that gap, Thames Water and its financing vehicle, Thames Water Super Senior Issuer PLC, have launched what they describe as the eighth round of consent and waiver requests to creditors. The process seeks approval to waive outstanding Accordion conditions and amend certain financing documents so that portions of the newly-committed funding can be drawn.

If approved, the proposals would permit the immediate drawdown of £410 million from the committed Accordion tranche. The company is also requesting an extension of the facility’s “June Release Condition” to 31 March 2026, which would allow a further £205 million to be accessed this month.

Beyond unlocking near-term liquidity, the consent request also seeks structural changes to the super-senior financing documents designed to give the company greater flexibility in accessing future Accordion funding. Under the proposed amendments, additional funds could be drawn in incremental tranches sized to match Thames Water’s operational liquidity needs if certain conditions remain outstanding.

The proposal also introduces a one-time, cashless exchange mechanism allowing participating creditors to switch between super-senior loans and bonds following the initial Accordion allocation process. The feature is intended to provide creditors with greater flexibility in how they hold the super-priority debt within the capital structure.

The latest consent solicitation comes after seven prior rounds of creditor approvals related to the company’s super-senior financing arrangements. Those approvals have allowed Thames Water to continue accessing liquidity while negotiations over a longer-term recapitalisation and restructuring remain ongoing.

Voting on the latest consent requests is scheduled for 16 March, though the process could close earlier if the required creditor majority is reached ahead of the deadline.