Creditors outline Thames Water board shake-up

The London & Valley Water consortium has announced a first cohort of proposed non-executive directors who would join the board of Thames Water Utilities Limited if its acquisition and recapitalisation proposal goes ahead. The proposed initial board members are Mike McTighe, Liz Barber, Clive Selley CBE and Dame Bernadette Kelly DCB. Their appointments would be subject to the recapitalisation being implemented, the related turnaround plan being adopted, and completion of Ofwat’s onboarding process for directors.

L&VW’s proposals are framed around a 10-year turnaround of Thames Water, with the new non-executive directors expected to oversee a comprehensive transformation of the business in the interests of customers and the wider public. The consortium presents the governance changes as a central element of restoring operational performance, compliance and resilience at the utility.

The L&VW consortium comprises around 100 financial institutions that are senior Class A creditors of Thames Water and its group. Collectively, they hold over an unspecified multi‑billion amount of Thames Water’s Class A and super senior debt. This creditor position underpins L&VW’s push to lead the recapitalisation and restructuring of the company.

By consolidating the interests of a large group of senior lenders, L&VW is positioning itself as a key stakeholder in determining Thames Water’s future capital structure and governance. The consortium’s role as a major creditor bloc is central to its proposal to acquire and recapitalise the utility.

Implementation of the L&VW proposal is contingent on a new capital structure for Thames Water being put in place through a court‑sanctioned process. The consortium says this would be pursued via a restructuring plan under Part 26A of the Companies Act 2006, or a Part 26 scheme of arrangement if feasible. These legal mechanisms would be used to bind affected creditors and implement the revised balance sheet.

L&VW is finalising a revised proposal following feedback from the Department for Environment, Food & Rural Affairs (Defra) and Ofwat. It intends to meet new ministers to discuss their priorities and present the updated plan. The timing and outcome of these engagements will influence whether the proposed governance and capital changes proceed.

Under the recapitalisation proposal, new investors would commit not to take any dividends from Thames Water for 10 years or until the company is returned to public markets via a listing on the London Stock Exchange. The consortium states that this is intended to ensure all profits are reinvested in the business and its assets during the turnaround period.

The proposed board is tasked with overseeing a 10‑year performance improvement and turnaround plan. Its goals include delivering a comprehensive operational transformation, restoring regulatory compliance, enhancing network resilience and rebuilding trust with customers, local communities and the public. The prospective non‑executive directors have signalled a focus on protecting public health and safety, keeping water bills fair and supporting vulnerable customers while securing water supplies.