Urgent Countdown: Thames Water's Future Hangs in Balance

Thames Water's senior creditors have expressed concern over the narrow timeframe for a market-driven rescue of the water company after U.S. private equity firm KKR retracted its multi-billion pound funding plan. Creditors have presented a long-term strategy to address the root causes of Thames Water's financial troubles.

The financially troubled utility, the largest in Britain, edged closer toward nationalisation following KKR's decision to step back from a 4 billion pound equity investment. The senior debt holders, emphasizing their history of effective management, have pledged to provide significant new investment to revitalize the company under fresh leadership.

The creditors emphasized the urgency of a market-led solution, warning of a diminishing window of opportunity. Dialogues with regulatory body Ofwat and the UK government are expected to intensify in the coming weeks. Market turnaround specialist Mike McTighe may be appointed as chairman, contingent on the proposal's success, sources suggest. Meanwhile, Thames Water is set to resume discussions on increasing customer bills following a postponed regulatory challenge, awaiting the expiration of the deferral period next month.

(With inputs from agencies.)