Business
Thames Water unveil £20.5 billion action plan to revive struggling water firm
The creditors of Thames Water have set out plans on how they would deliver £20.5 billion of investment to turn around the troubled supplier’s performance as they look to secure a rescue of the firm.
The supplier’s main creditors – led by a team of 15 investors called the London & Valley Water consortium – have pledged to “fix the foundations” of Thames Water with the mammoth spending proposal put forward to regulator Ofwat.
They are promising an increased focus on improving Thames Water’s poor pollution performance and record on leaks, with targets to cut sewage spills by at least 135 a year.
Thames Water – the UK’s biggest water supplier with around 16 million customers – is on the brink of nationalisation as it struggles under a mountain of debts.
The creditors are looking to secure backing for their plans to avoid Thames Water being put into a temporary special administration regime (SAR), which would effectively wipe out their investments.
Their spending proposals would see them work within the £20.5 billion investment allowance set by Ofwat in its final determination on Thames Water spending and bill rises.
Household bills would not rise by more than the regulator has already approved over the next five years, the group stressed.
But it said the plans would need “billions of pounds of new funding” from the consortium.
It remains in talks over a rescue deal of the supplier that would see them pump in new cash, but ask for leniency in how it is regulated.
The creditors hope to put forward updated plans on a funding deal and debt overhaul for Thames Water within the next couple of weeks.
Mike McTighe, chairman designate of the London & Valley Water consortium, said: “Over the next 10 years the investment we will channel into Thames Water’s network will make it one of the biggest infrastructure projects in the country.
“Our core focus will be on improving performance for customers, maintaining the highest standards of drinking water, reducing pollution and overcoming the many other challenges Thames Water faces.
“This turnaround has the opportunity to transform essential services for 16 million customers, clean up our waterways and rebuild public trust.”
The creditors are the bondholders who now effectively own Thames Water after the High Court approved a financial restructuring earlier this year through a loan of up to £3 billion to ensure it can keep running until the summer of 2026.
The firms involved – which include US and UK investment firms such as Aberdeen, Elliott Management and BlackRock – submitted an initial financial plan in June to overhaul £17 billion of Thames Water’s debts, including investing another £3 billion in new equity and a further £2 billion of funding.
But they also asked for leniency on performance targets and compliance, warning that a “regulatory reset” was needed for the utility, or its performance would likely worsen.
The latest investment plans would see the group commit to spending £9.4 billion on sewage and water assets over the next five year, up 45 per cent on current levels.
Of this, £3.9 billion would be spent on upgrading the worst performing sewage treatment sites, £1.2 billion on helping deliver high-quality drinking water and £2.7 billion on stopping sewage spill incidents.
Longer term proposals would see 1,000km of water mains replaced over the coming decade, with £545 million targeted to replace around 370km by 2030.
Thames Water’s current management has previously said it would need over £24 billion of investment allowance for the next five years and to increase bills by more than Ofwat had agreed.
The government appointed insolvency specialists FTI Consulting last month to step up contingency planning in case the supplier collapses.
A possible rescue deal with US private equity giant KKR collapsed in May, but the government has stressed its preference is for a “market-based solution” rather than a costly temporary nationalisation.
The FTSE 100 gave back early gains to close lower on Friday as a weak US jobs report boosted hopes of rate cuts, but also raised fears the world’s biggest economy was slowing.
“The [US] labour market is in a precarious position,” said analysts at Wells Fargo, putting the Federal Open Market Committee in a position “where it will imminently start cutting the federal funds rate”.
The FTSE 100 index closed down 8.66 points, 0.1%, at 9,208.21. It had earlier traded as high as 9,253.53.
The FTSE 250 ended 100.86 points higher, 0.5%, at 21,575.54 and the AIM All-Share finished up 3.63 points, 0.5%, at 765.63.
For the week, the FTSE 100 rose 0.2%, the FTSE 250 fell 0.1% and the AIM All-Share firmed 0.2%.
In New York, at the time of the London equities market close, the Dow Jones Industrial Average was down 0.7%, as was the S&P 500, while the Nasdaq Composite dropped 0.5%.
Friday saw another weak jobs report in the US with growth in non-farm payrolls well below market expectations, while the unemployment rate moved higher.
According to the Bureau of Labour Statistics, non-farm payroll employment increased by 22,000 in August, easing from 79,000 in July.
The July reading was upwardly revised from 73,000, however, June’s reading was knocked down to a net loss of 13,000 jobs from a gain of 14,000 previously reported.
The latest data fell short of the FXStreet cited consensus of 75,000.
The jobless rate edged up to 4.3% in August, as expected, from 4.2% in July.
Thomas Feltmate, senior economist at TD Economics, said: “There’s no escaping that the labour market is softening, and quickly.
“Fed officials have become increasingly concerned about the downside risks to the labour market, and this morning’s report will not assuage those fears.
“We maintained an out-of-consensus view since April that the Federal Reserve would need to deliver 75 basis points in rate-relief this year, and our conviction remains high that it will occur.”
Wells Fargo said the jobs engine, that has been integral to US economic growth defying expectations for the past four years, is “stalling”.
“With elevated risk of further downward revisions, the recent pace of hiring is dangerously close to crossing into negative territory, where job market weakness quickly becomes self-reinforcing,” the broker warned.
The report put pressure on the dollar and saw bond yields ease further.
The pound jumped to 1.35 dollars late on Friday afternoon in London, compared to 1.34 at the equities close on Thursday. The euro firmed to 1.17.
The yield on the US 10-year Treasury was quoted at 4.07%, narrowed from 4.20% on Thursday. The yield on the US 30-year Treasury was quoted at 4.79%, eased from 4.90%.
In Europe, the Cac 40 in Paris ended down 0.6%, while the Dax 40 in Frankfurt closed 0.9% lower.
Shares in Cobham-based housebuilder Bereley rose 3.0% as it said it is on track to report pretax earnings in line with its £450 million forecast for the financial year ending April 30, 2026, and down 15% from £528.9 million in financial 2025.
Berkeley said it has already secured 85% of its guided pretax earnings through exchange sales contracts, and that the firm remains on target to achieve a similar level of profit in financial 2027.
Berkeley’s update came as the Halifax house price index found that the average UK house price increased by 0.3% to a new record high of £299,331 in August.
“Affordability remains a challenge, but there are signs of improvement,” said Amanda Bryden, head of mortgages at Halifax.
Other housebuilders took heart from the news. Persimmon rose 2.8%, Barratt Redrow by 2.1% and Taylor Wimpey by 2.2%.
Aviva climbed 1.6% as Goldman Sachs restarted coverage of the insurer with a ‘buy’ rating and 736 pence price target.
But Admiral fell 3.0% as Peel Hunt downgraded to “sell” from “reduce” believing the outlook for underwriting margins in the UK motor space is “starting to deteriorate”.
A sharp drop in the oil price saw BP and Shell drop 2.6% and 2.3% respectively. A barrel of Brent traded at 65.14 dollars late Friday afternoon, down from 67.02 on Thursday.
Next rose 0.8% after UK retail sales accelerated ahead of expectations in July following continued good weather.
Total retail sales volumes are estimated to have risen by 0.6% in July, accelerating from an increase of 0.3% in June and comfortably beating an FXStreet-cited consensus for 0.2% growth in July.
Food store sales rose 2.5% in July to their highest level since February 2022, boosted by good weather and events such as the Women’s Euro 2025 tournament. Food store sales had increased 0.7% in June.
The ONS noted that the UK had its fifth-warmest July on record this year, according to the Met Office climate summaries.
The biggest risers on the FTSE 100 were Entain, up 28.00p at 864.40p, Berkeley Group, up 108.00p at 3,690.00p, Ashtead, up 152.00p at 5,538.00p, Persimmon, up 30.00p at 1,100.00p and Melrose, up 16.00p at 616.00p.
The biggest fallers on the FTSE 100 were Admiral, down 102.00p at 3,342.00p, BP, down 11.25p at 415.65p, Barclays, down 9.20p at 361.05p, NatWest, down 12.00p at 506.00p and Shell, down 60.50p at 2,627.50p.
Monday’s local corporate calendar has half-year results from insurer Phoenix Group.
The global economic calendar on Monday has China trade data.
Later in the week, US inflation figures and the ECB interest rate decision, both on Thursday, will be closely watched.
Tesla boss Elon Musk will receive a pay package worth over $1tn (£740bn) if he hits a list of ambitious targets over the next decade, the board of the electric car firm has proposed.
To get the package, Musk, who is already the world’s richest person, would need to boost Tesla’s value eightfold, sell a million artificial intelligence robots, sell another 12 million Tesla cars, and hit several other moonshot goals.
Musk would not earn a salary or bonus but would instead be gradually awarded shares which would be worth $1tn if he achieves all the targets.
The company’s board urged investors to vote in favour of the package.
“Growth that may seem impossible today can be unlocked with new ideas, better technology and greater innovation,” Tesla chair Robyn Denholm said.
“Simply put, retaining and incentivising Elon is fundamental to Tesla achieving these goals and becoming the most valuable company in history.”
She added that the share award would “drive peak performance from our visionary leader”.
It comes after Musk was awarded $29bn in shares last month after his original $50bn award was struck down by a US court for being “unfair to shareholders”.
Under the latest plan, Musk would be awarded shares in 12 tranches, tied to 12 market milestones. The first milestone is for Tesla’s market value to double to $2tn.
The final market value milestone is $8.5tn – more than double the value of chip giant Nvidia, the world’s most valuable company.
He must also hit an operational milestone alongside each market milestone, which include the robot and vehicle targets, and a goal to increase one of Tesla’s earnings figures 24-fold.
According to Tesla’s latest financial report, sales are falling at their fastest rate in a decade, an issue which some experts have put down to Musk’s “toxic” reputation.
Dan Coatsworth, investment analyst at AJ Bell, said the suggested pay award “beggars belief”.
“Is one person worth that much?” he asked.
Mr Coatsworth added that Musk “presides over a company that has lost its edge, is being overtaken by rivals, and whose brand has been tarnished by Musk’s actions outside of Tesla.”
He continued: “Surely Musk should be fighting for his job, not Tesla’s board fighting to keep him?”
The board’s unprecedented pay proposal comes just months after it was forced to deny reports that it was looking to replace Musk.
According to a report in the Wall Street Journal in May, which Tesla said was “absolutely false”, the board hired headhunters to replace Musk because he was too focused on his work with US President Donald Trump to tackle Tesla’s sinking share price.
The Wall Street Journal told the BBC at the time it stood by its reporting.
Mr Coatsworth said: “One minute Tesla’s board is wondering if Elon Musk is a liability to the company given his outspoken views and political distractions, the next they’re effectively saying ‘pick a number, any number’ to lock him in for as long as possible.”
Cargo containers stacked aboard a ship at the Jakarta International Container Terminal in Tanjung Priok Port on Aug. 7, 2025.
Str | Afp | Getty Images
The private market assets platform Yieldstreet struck a deal to recoup some of its legal expenses for an ill-fated series of marine loans — but its customers are less fortunate.
Yieldstreet is getting $5 million in a settlement with the borrowers who defaulted on the marine loans, the startup told customers last week in letters obtained by CNBC.
But since the company’s recovery cost “well exceeds the entire settlement amount,” it’s unlikely investors will see any repayment, Yieldstreet said. The deals are being closed and financial statements showing losses will be filed by February, the company said.
“We recognize this outcome is disappointing,” Yieldstreet said in the investor letter. “Yieldstreet pursued this extensive recovery effort because we are committed to exhausting every reasonable avenue for investor recovery.”
Yieldstreet put its investors into deals totaling $89 million in loans that were supposed to be backed by 13 ships, according to a lawsuit filed by the startup against the borrower in that project. The loans float money to companies that take apart ships for scrap metal; the vessels themselves are the collateral on the deals.
Yieldstreet lost track of the ships and then pursued the borrower, which it accused of fraud. While it won monetary awards in a number of jurisdictions outside the U.S., the borrower avoided paying the startup by concealing their assets, Yieldstreet said in the August investor letter.
The episode garnered media coverage and in 2020 contributed to the collapse of a high-profile partnership with BlackRock, the world’s largest asset manager.
The news of this latest loss follows CNBC’s report last month that Yieldstreet customers in four real estate deals worth $78 million have been wiped out, with roughly $300 million of other deals on watchlist for possible losses.
This year, Yieldstreet changed its CEO and announced a new business model that leans more on distributing private market funds provided by established Wall Street firms including Goldman Sachs and the Carlyle Group.
In a statement provided to CNBC, Yieldstreet said the investor letters refer to marine loan deals from 2018 and 2019 in an asset class that the firm no longer offers.
“While substantially less than the amounts invested by the funds and ultimately the investors, this settlement allows us to bring closure to litigation that could otherwise continue indefinitely,” Yieldstreet said in the statement.
The firm “takes its fiduciary responsibilities seriously and, throughout the recovery effort, advanced its own funds in an effort to protect its investors and has absorbed significant losses alongside its investors,” the startup said.
Bitter end
Arman, an investor who plowed $180,000 into marine loans in 2019, called the result a bitter disappointment. After receiving $16,000 from Yieldstreet in a class action settlement tied to the soured marine deals, he estimates that he lost more than 90% of his original investment.
CNBC is withholding Arman’s last name from publication at his request.
“My mother passed away in 2018, and I didn’t know where to put the money,” Arman said. “I thought this was somewhere safe to put it, and it wasn’t.”
The Yieldstreet marine loan deal was supposed to mature in six months, a relatively short-term investment.
Instead, it stretched into a six-year saga for Arman, who works as a firefighter and paramedic near the West Coast.
“They are now washing their hands of the whole thing,” he said. “They are taking $5 million to cover their own expenses, with no regard for investors.”
Abercrombie & Fitch named official fashion partner of Dallas Cowboys
New non-volatile memory platform built with covalent organic frameworks
Tyson, Mayweather Jr. to compete in exhibition
-
Tech1 week agoTop CDC Officials Resign After Director Is Pushed Out
-
Sports1 week agoDolphins GM Chris Grier says fans threatened his family in string of vile emails after team’s lackluster year
-
Entertainment1 week agoYouTube TV viewers could lose access to Fox channels over contract dispute
-
Tech1 week agoReal-time technique directly images material failure in 3D to improve nuclear reactor safety and longevity
-
Tech1 week agoManufacturas Eliot boosts digital shift with Coats Digital’s VisionPLM
-
Tech7 days agoSSA Whistleblower’s Resignation Email Mysteriously Disappeared From Inboxes
-
Entertainment1 week agoSabrina Carpenter gives insight into her new music and viral debate over album cover
-
Tech1 week agoWatch Our Livestream Replay: Back to School in the Age of AI