Sir Adrian Montague has been appointed chairman of beleaguered utility company, Thames Water.
He will start his new term of office on July 10, succeeding Ian Marchant.
Earlier this week, Sarah Bentley resigned as chief executive of Thames Water and stepped down from the board. She was immediately replaced by Alastair Cochran and Cathryn Ross as joint interim chief executive officers.
Nationalisation Mooted
The news comes as the government is considering temporarily taking Thames Water into public ownership as the troubled company struggles to stop itself from drowning under a wave of toxic debt.
Thames Water has amassed a £14bn debt and held talks yesterday with shareholders to secure extra funding on top of an £500m cash injection it received three months ago.
But the government is making plans to put the company into an insolvency measure called a Special Administration Regime if necessary.
Ministerial Concern
Earlier today Business Secretary, Kemi Badenoch, said she was “very concerned” about the future of the company and said “Obviously this is a commercially sensitive situation and I know that my colleagues across government are looking at what we can do. We need to make sure that Thames Water as an entity survives.”
But ministers have also been at pains to reassure the public that their bills will not be affected by the crisis.
Health Minister, Neil O’Brien, told Sky News: “Absolutely nothing is going to happen in terms of either their bills or their access to water.”
Regulator, Ofwat, agreed that the company has “significant issues” to address.
“Their environmental record and leakage performance are poor,” Ofwat said, adding: “They need to improve their financial resilience too.”
But it insisted that overall the company was in a good position.
It said: “That is all in the context of a company that has strong liquidity – it recently received an additional £500 million from shareholders and has £4.4bn of cash and committed funding.”
Ofwat added: “Overall, the sector is continuing to attract international capital and is especially attractive to long term investors such as pension funds. Indeed, there has been an additional equity injection of around £2bn since 2020, with companies acting to strengthen their financial position.”
Owned by pension funds, sovereign wealth funds and investment firms, it is the country’s largest water company with 15 million customers in London and Thames Valley.
In a statement, the company said: “Thames Water received the expected £500m of new funding from its shareholders in March 2023 and is continuing to work constructively with its shareholders in relation to the further equity funding expected to be required to support Thames Water’s turnaround and investment plans.”
It added: “Ofwat is being kept fully informed on progress of the company’s turnaround and engagement with shareholders.”
It was debt free when it was privatised under the premiership of Margaret Thatcher in 1989 but its troubles with indebtedness swelled when it was owned by Australian investment bank, Macquarie, which sold the company in 2017.
