Macquarie ‘very proud’ of Thames Water ownership despite loading it with debt

The concern slope that sold Thames Water successful 2017 aft loading the institution with indebtedness has said that it is “very proud” of its record, adjacent arsenic the h2o inferior teeters connected the verge of collapse.

Australia-headquartered Macquarie led a consortium that owned Thames Water from 2006 until 2017. Macquarie has been criticised by immoderate politicians and analysts for its power of the business, accusing the slope of mounting it connected people for fiscal collapse.

Thames Water supplies h2o and sewerage services to 16 cardinal customers successful London and south-east England. However, it has reached the borderline of illness aft debts roseate to adjacent £20bn, and it past period won tribunal support for £3bn successful exigency funding.

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Macquarie’s critics reason that the concern slope acceptable Thames Water connected the people to ruin. Debt astatine the inferior roseate from £3.4bn erstwhile Macquarie bought successful to £10.8bn erstwhile it sold its past involvement successful 2017. At the aforesaid time, Macquarie and different investors received dividends worthy £2.8bn.

Ben Way, the radical caput of Macquarie Asset Management, past period told investors connected a telephone that Thames Water had improved nether its ownership.

“We’re really proud, precise arrogant of our ownership of Thames Water,” Way said. “It was a overmuch amended business, imperfect, but overmuch amended concern aft our stewardship, and we can’t speech astir what happened subsequently.”

Way, who has worked for Macquarie since 2006, denied immoderate nexus betwixt Thames Water’s much caller fiscal struggles and the bank’s ownership, according to a transcript hosted by the information institution AlphaSense. The Financial Times archetypal reported connected the comments.

“So ideate being blamed for a location that you ain 7 years agone erstwhile the extortion leaked,” helium said. “It is rather strange.”

Despite the £3bn indebtedness package, Thames Water inactive has to unafraid longer-term equity concern successful bid to money upgrades to sewer and h2o attraction works aft decades of underinvestment. Thames has chosen KKR, a US backstage equity investor, arsenic its “preferred partner”. The New York-based institution is expected to get a involvement successful Thames worthy £4bn.

Macquarie is present the biggest shareholder successful Southern Water, different inferior nether fiscal pressure. Way said Macquarie had not faced a backlash from the authorities implicit its grounds connected Thames.

“What I would accidental is that Thames Water is simply a precise bully illustration of the quality to person the courageousness of your convictions and look beyond the media play oregon noise,” Way said. “Because the information of the substance is, nary regulator successful the UK successful the past 10 years has looked astatine Macquarie different than arsenic a precise affirmative proprietor of assets.”