Thames Water creditors eye ‘golden share’ for Burnham
Thames Water creditors eye ‘golden share’ for Burnham
Matt OliverSun, July 19, 2026 at 5:15 PM UTC
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Andy Burnham, the incoming prime minister, is set to push for greater ‘public control’ of the water industry - Carl Court/Getty Images
Thames Water’s creditors have signalled they are open to part-government ownership of the struggling utility for the first time in nearly 40 years as they seek to fend off nationalisation under Andy Burnham.
With the incoming prime minister set to push for greater “public control” of the water industry, the company’s creditors have said they are willing to accept a deal that could see the British state become a shareholder.
This could potentially take the form of a “golden share” that gives ministers a veto over key decisions, or a conventional equity stake, a source close to the situation said on Sunday.
The creditors are also preparing a revised business plan that will offer more private cash for investment in Thames Water’s infrastructure and board engagement with local authorities and MPs in the South East.
No offer of a government stake has been formally tabled by creditors yet, as it was not an option discussed under Sir Keir Starmer’s administration. But The Telegraph understands they will say they are open to that possibility, if asked.
The development comes amid reports that Mr Burnham is preparing to put Thames into special administration as one of his first acts in power, a move that some in the City believe could be a precursor to full-blown nationalisation.
An ally of the former mayor of Greater Manchester told The Sunday Times that the taxpayer “needs to receive something in return – that means control” if the Government decides to provide the £2bn that Thames needs to keep going next year.
It is not yet clear whether the new Labour leader is prepared to stomach the steep costs of putting the entire company on the public balance sheet.
Thames’s creditors are currently owed £17bn collectively and are expected to defend their interests in court in any scenario where the company is nationalised.
One insider warned that could result in “litigation that dragged on for years”.
Alternatively, if the special administration led to a normal sales process, creditors would also be expected to bid for the company alongside rivals.
The creditors are trying to put together a revised turnaround package after criticism from Emma Reynolds, the Environment Secretary. They will promise hundreds of millions of pounds of extra capital spending.
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Creditors have already offered to pump at least £20bn into the company up to 2030, including around £10bn in capital spending, funded by £6.5bn in debt and about £3.4bn in equity.
That could potentially open the door for the Government to take equity in Thames Water, potentially through a vehicle such as the National Wealth Fund, sources suggested.
The creditors have pledged not to take money out of the business until it is back on its feet and listed as a public company on the London Stock Exchange.
In return, they are lobbying the Government for leniency on performance fines, which they want to settle in one go to provide more certainty about the company’s revenues.
The Government has been preparing for the possibility that Thames Water may need to be placed into special administration since at least last year, when it appointed advisers from FTI Consulting.
However, Thames bosses are understood to believe that the company does not yet meet the threshold for administration.
They have said the company needs a £2bn cash injection to survive for another year beyond December and creditors have so far signalled they are willing to provide this.
Despite approaches, the creditors have not yet had any engagement with Mr Burnham’s camp and remain in the dark about what the Labour leader’s intentions are.
Mike McTighe, the City grandee who is also representing Thames creditors, stressed they wanted to “work with Andy Burnham, his government and local authority leaders to rebuild confidence in Thames Water and the wider sector”.
He added on Sunday: “We are keen to meet new ministers as soon as possible to discuss how we can work together in the best interests of customers, including by enhancing public control of the company’s operations.
“We remain ready and willing to recapitalise Thames Water, return it to investment grade and begin the long process of turning it around. We urgently need government engagement to begin that process.
“It will take time to fix a complex business like Thames Water but we are committed to rebuilding trust with the customers and public we serve.”
A spokesman for Mr Burnham was approached for comment.
Source: “AOL Money”
