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The board of Thames Water was locked in crunch talks on Wednesday as shareholders prepare to dilute a pledge to inject funds into the company that would secure its survival.

Sky News has learnt that the directors of Britain’s biggest water company met to discuss its financial future after months of talks involving debt and equity investors, lenders, regulators and government officials.

One industry source said that Thames Water‘s shareholders, who include the Universities Superannuation Scheme (USS) and China’s sovereign wealth fund, were poised to conclude that they were unable to contribute hundreds of millions of pounds of promised funding after Ofwat, the industry watchdog, indicated that it would not bow to the company’s demands for a package of regulatory concessions.

Talks were continuing into Wednesday evening, and it remained possible that the picture could change ahead of an announcement expected to be made by the company on Thursday morning.

Thames Water’s shareholders had indicated that they were prepared to commit £3.25bn to the company in the coming years, with the first £750m due to be injected this year.

The investors’ likely decision to water down that commitment is not irreversible and could still be changed if the financial profile of a future investment improved, said a source close to one of them.

The company employs about 7,000 people, and serves nearly a quarter of Britain’s population.

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December: Thames Water can’t pay £190m

It is, however, drowning in well over £15bn of debt, with huge interest payments required to service it.

Thames Water’s shareholders also include the Canadian pension fund Omers, Infinity Investments, a subsidiary of the Abu Dhabi Investment Authority, and the BT Pension Scheme.

The utility has been seeking concessions including a 40% rise in consumers’ water bills, an easing of capital spending requirements and leniency on forthcoming regulatory penalties.

If the shareholders ultimately confirm their decision to pull the plug on additional financial support that was announced last year, it would appear to leave the heavily indebted company with few viable options to secure its future.

Last summer, Sky News revealed that Whitehall officials had started drawing up contingency plans for Thames Water’s collapse amid fears that it might not survive.

However, in an investment plan unveiled in October, the company said its shareholders were “stepping up to support… much-needed investment, underscoring their commitment to delivering Thames’ turnaround and life’s essential service for the benefit of our customers, communities and the environment”.

“Shareholders have already invested £500m of new funds in 2023,” it said at the time.

“In addition, they have agreed to provide a further £750m in new equity funding… subject to satisfaction of certain conditions, including the preparation of a business plan that underpins a more focused turnaround that delivers targeted performance improvements for customers, the environment and other stakeholders over the next three years and is supported by appropriate regulatory arrangements.

“Our shareholders have also acknowledged the need for additional equity investments indicatively in the region of £2.5bn in [the next regulatory period].

“In aggregate, this would equate to total equity investment of £3.7bn, the largest equity support package ever proposed in the UK water sector.”

The £750m referred to in that announcement is now unlikely to proceed without profound regulatory changes, the company is expected to say on Thursday.

If Thames Water did eventually collapse, a temporary nationalisation would involve placing the company’s operating business into a special administration regime (SAR) akin to that used when the energy supplier Bulb collapsed in 2021.

That would ignite concerns in government that the triggering of a SAR could ultimately cost taxpayers billions of pounds.

Ultimately, the Bulb administration cost the public purse a far smaller sum, but water industry ownership restrictions which prevent consolidation mean this figure could be dwarfed if Thames Water was to fail.

Thames Water serves 15 million customers across London and the south-east of England, and has come under intense pressure in recent years because of its poor record on leaks, sewage contamination, executive pay and shareholder dividends.

It is facing multiple fines and regulatory investigations, including into the payment of dividends to Kemble Water, its parent company.

The company has been beset by management turmoil, with Sarah Bentley, its chief executive for the last three years, resigning last summer.

She was replaced by Chris Weston, the former Aggreko chief.

The financial peril in which Thames Water finds itself has sparked calls from critics of the privatised industry to renationalise all of the UK’s major water companies.

A number of the companies have been forced to seek extra funding from their shareholders, with the state of the water industry likely to feature prominently during the general election campaign.

Nearly £1.4bn of the company’s bonds mature by the end of this year, with Ofwat price controls meaning water companies have little scope to generate additional income.

Read more:
Thames Water lenders hire EY as debt deadline looms
Thames Water bosses admit it can’t meet April debt repayment
Water firms face backlash over record sewage spills in England

In total, tens of billions of pounds have been handed to shareholders in water utilities across Britain since privatisation, stoking public and political anger given the industry’s frequent mismanagement.

Earlier this month, Sky News revealed that a group of lenders to Thames Water’s parent company had engaged advisers weeks before a £190m debt held by Britain’s biggest water utility falls due.

Thames Water and a spokesman for its shareholders declined to comment on Wednesday evening.

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What is freezing rain and what makes it so dangerous?

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What is freezing rain and what makes it so dangerous?

An amber warning for snow and ice, with the risk of freezing rain, covers most of Wales and central England until midday on Sunday.

Freezing rain, which makes up what are commonly known as ice storms in North America, is a rarity in the UK because the conditions for it are quite specific, according to the Met Office.

But what is it and how is it different to snow?

Freezing rain is rainfall that has become “supercooled” as it falls from the sky.

Up to 30cm of snow expected in parts of UK – follow live

It starts when snow, ice, sleet or hail high up in the atmosphere melts into rain when it falls through the layers of warmer air below.

If the rain then passes through a sub-zero layer of air just above the ground, it can remain liquid and instead become “supercooled”. This is the key to freezing rain.

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Supercooled water will freeze on impact – forming a clear layer of ice on cold surfaces such as trees, roads and power lines.

Why is it dangerous?

It’s once it hits the surface and turns to ice that it can pose a real threat.

The ice is very clear, often referred to as black ice, because it is so difficult to see, making it treacherous for pedestrians and drivers.

Freezing rain settled on a car. Pic: iStock
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Freezing rain on a car. Pic: iStock

Sky News meteorologist Kirsty McCabe explains: “The supercooled rain hits the ground and freezes instantly on impact, and that creates a thin layer of ice, also known as glaze, and it’s clear, so you can’t see the ice, which makes it really treacherous.”

If it hits power lines or tree branches, depending on how much rain there has been, the weight of the ice can cause them to break off because they can’t support the weight.

It can also make it difficult to open your car door if there is enough of it.

Get the five-day forecast where you are

Where is it expected to fall?

From 6pm on Saturday to midday on Sunday an amber warning for snow and ice, with the risk of freezing rain, covers most of Wales and central England, including the Midlands and Liverpool and Manchester in the North West.

But McCabe says it’s Wales where people should be particularly wary of freezing rain.

What precautions should people take?

The best thing people can do is take extra care when travelling. As it is so hard to see, it’s difficult to judge just how icy road surfaces are.

The RAC says freezing rain is arguably the most treacherous of all conditions for motorists.

They urge people not to drive unless necessary, but say those who do need to should check they have plenty of fuel and oil and check their tyre treads.

They also encourage drivers to make sure their lights are working and check they have screenwash.

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King deeply saddened by death of Briton in New Orleans attack – as reports say victim is stepson of ex-royal nanny

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King Charles deeply saddened by death of Briton in New Orleans attack - as reports say victim is stepson of ex-royal nanny

The King is deeply saddened by the death of a British man who was killed in the attack in New Orleans on New Year’s Day – amid reports he was the stepson of an ex-royal nanny.

Edward Pettifer, from Chelsea, west London, was fatally injured in the tragedy, the Metropolitan Police confirmed.

Sky News understands the King was made aware of Mr Pettifer’s death through official channels, was deeply saddened, and has been in touch with the family to share personal condolences.

The 31-year-old’s family said they were “devastated” by his death.

“He was a wonderful son, brother, grandson, nephew and a friend to so many,” the family said in a statement.

“We will all miss him terribly. Our thoughts are with the other families who have lost their family members due to this terrible attack. We request that we can grieve the loss of Ed as a family in private.”

New Orleans’ coroner said the preliminary cause of death for Mr Pettifer was blunt force injuries.

Police vehicles are parked near the site of a fatal truck attack in New Orleans, Louisiana, on Jan. 1, 2025. At least 15 people were killed and dozens injured in a suspected terrorist attack earlier in the day when a pickup truck was driven into a crowd celebrating New Year's Day in a popular tourist spot in the southern U.S. city, according to U.S. media. (Kyodo via AP Images) ==Kyodo
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Emergency crews at the scene of the attack. Pic: AP

FBI agents at the scene of the attack in New Orleans. Pic: Reuters
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FBI agents at the scene. Pic: Reuters

Fourteen people were killed and dozens injured when 42-year-old army veteran Shamsud-Din Jabbar’s rented truck rammed into people in New Orleans’ famous Bourbon Street in the early hours of New Year’s Day.

Jabbar was killed in a shootout with police.

The Federal Bureau of Investigation (FBI) said the attack was “premeditated” and an “evil” act of terrorism, and added Jabbar was “100% inspired by ISIS”, also known as Islamic State.

An IS flag that was attached to the pick-up truck that was driven down Bourbon Street
Image:
An IS flag was attached to the pick-up truck that was driven down Bourbon Street

The preliminary cause of death for all the victims was blunt force injuries, according to the New Orleans coroner.

The coroner has identified most of those killed in the attack, with efforts continuing to identify the final female victim.

• Edward Pettifer, 31, from Chelsea, west London
• Andrew Dauphin, 26, from Montgomery, Alabama
• Kareem Badawi, 23, from Baton Rouge, Louisiana
• Brandon Taylor, 43, from Harvey, Louisiana
• Hubert Gauthreaux, 21, from Gretna, Louisiana
• Matthew Tenedorio, 25, from Picayune, Mississippi
• Ni’Kyra Dedeaux, 18, from Gulfport, Mississippi
• Nicole Perez, 27, from Metairie, Louisiana
• Reggie Hunter, 37, from Prairieville, Louisiana
• Martin Bech, 27, from New York City, New York
• Terrence Kennedy, 63, from New Orleans, Louisiana
• Elliot Wilkinson, 40, from Slidell, Louisiana
• William DiMaio, 25, from Holmdel, New Jersey

Victims of the New Orleans attack, clockwise from top left: Reggie Hunter, Martin 'Tiger' Bech, Nicole Perez and Matthew Tenedorio
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Some of the victims of the New Orleans attack, clockwise from top left: Reggie Hunter, Martin ‘Tiger’ Bech, Nicole Perez and Matthew Tenedorio

Billy DiMaio (L) and Terrence Kennedy
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William DiMaio (left) and Terrence Kennedy

Read more:
What we know about suspect

British man, aspiring nurse and Princeton University football player among victims
Did New Orleans authorities fail the victims of the New Year terror attack?

An Islamic State (IS) flag, weapons, and what appeared to be an improvised explosive device (IED) were found in the vehicle used in the attack, the FBI said.

The suspect posted five videos on social media before the rampage in support of IS, the agency added.

In his first clip, Jabbar said he was planning to harm his own family and friends, but was concerned headlines would not focus on the “war between the believers and disbelievers”, said Christopher Raia, deputy assistant director of the FBI’s counter-terrorism division.

Jabbar also joined IS “before this summer”, and provided a will, the FBI chief said.

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The half-brother of the attack suspect said ‘this wasn’t the man I knew’

In an interview with a Texas-based TV station, owned by Sky News’ partner network NBC News, Jabbar’s younger half-brother said he was thinking about all those impacted by the attack.

Abdur-Rahim Jabbar said: “This is a tragedy. We’re all grieving about this.”

The suspect was a Muslim, with his sibling adding: “This wasn’t the man I knew. This wasn’t the father, the son that I knew.

“And that also, this isn’t any representation of Islam or Muslims or the Muslim community.”

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Stargazers treated to rare sight as Venus appears beside crescent Moon

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Stargazers treated to rare sight as Venus appears beside crescent Moon

Stargazers spied an unusual sight on Friday night, as Venus appeared beside a crescent moon.

The planet could be seen with the naked eye in locations lucky enough to have clear skies and incredible pictures show it seemingly shining.

Venus is often called the Morning or Evening Star, as it can easily be mistaken for a bright star.

 03 January 2025, Brandenburg, Sieversdorf: The 16 percent visible crescent moon can be seen together with Venus (at the top of the image) in the early evening sky. After the sun and the moon, the planet Venus is the brightest astronomical object in the night sky. Photo by: Patrick Pleul/picture-alliance/dpa/AP Images
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The view from Sieversdorf, Germany. Pic: AP

03 January 2025, Brandenburg, Sieversdorf: The 16 percent visible crescent moon can be seen together with Venus (at the top of the image) in the early evening sky. After the sun and the moon, the planet Venus is the brightest astronomical object in the night sky. Photo by: Patrick Pleul/picture-alliance/dpa/AP Images
A crescent moon and the planet Venus straddle a cross on top of Quebec Baptist Church in Ellaville, Georgia, U.S. January 3, 2025. REUTERS/Sam Wolfe
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The Moon and Venus straddle a cross on top of Quebec Baptist Church in Ellaville, Georgia. Pic: Reuters

January looks set to be a good month for stargazers and astronomers, as numerous celestial phenomena will be visible across the coming weeks.

The Quadrantid meteor shower is at its peak this weekend and visible until 12 January.

A crescent moon and the planet Venus are seen next to an oak tree in Ellaville, Georgia, U.S. January 3, 2025. REUTERS/Sam Wolfe
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Venus – seen here from Georgia, USA – didn’t appear as bright when viewed from the States. Pic: Reuters

On 16 January, there’s a strong chance you’ll be able to see Mars as the red planet will be in “opposition”, meaning Earth will be directly between it and the sun.

Just under a week later, on 21 January, you could see five planets – Saturn, Venus, Uranus, Jupiter and Mars – in the night sky after 9pm, according to the Royal Observatory Greenwich.

More from Sky News:
NASA spacecraft survives approach to the sun
Stranded astronauts send message from space

Four of the planets should be visible to the naked eye, but seeing Uranus will require a telescope or very dark skies.

Anyone hoping to spot celestial phenomena is advised to find a stargazing spot away from light pollution and to allow at least 15 minutes for your eyes to adjust to the darkness.

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