Yahoo Finance Thames Water heads back to the Caymans for £145m bond
Thames Water has quietly raised a £145m bond through the Cayman Islands subsidiary it vowed to shut as part of a plan to rescue its damaged reputation.
Britain’s biggest water supplier said it would shut its tax haven office and scrap shareholder payouts this year in a bid to rebuild public trust after years of rock-bottom tax receipts and bumper returns for its investors.
But the group has dealt a blow to its own clean-up operation by pushing ahead with a bond issuance via the Caymans.
Thames finance director Brandon Rennet said: “All the paperwork is set-up to issue bonds through the Cayman programme. If we wanted to issue it through another vehicle, we would need the bondholders’ permission, which would take time.”
Thames’ latest controversy comes amid rising calls for water companies to be renationalised, in part sparked by the utility’s track record under the ownership of Australian investment bank Macquarie.
The company provoked an outcry after it emerged that a £1bn was siphoned off by its previous owners over the last decade, during which time Thames was held responsible for a disastrous sewage leak into the Thames and paid very little corporation tax.
The bond issuance has emerged just days after the regulator branded the company one of the worst in the sector for transparency.
Aileen Armstrong, from Ofwat, said: “As customers, we want to be able to trust what we get from our water company – be that the water out of the tap or what they tell us. Unfortunately, on the second of those, our checks suggest we might not be able to take everything at face value.”
