Hong Kong-based CK Infrastructure has made a £7bn ($8.86bn) bid for a majority stake in troubled UK utility company Thames Water, in excess of a $5bn offer tabled by private equity giant KKR for the water supplier, according to a report by the Financial Times.
The report cites unnamed sources as revealing that the proposal from CK Infrastructure – the largest publicly listed infrastructure company in Hong Kong – which was submitted earlier this month, comes with a major condition: bondholders must take significant losses as part of the deal.
Thames Water, burdened with £18bn in debt, secured a £3bn emergency financing deal from senior creditors this week, staving off potential collapse and a government bailout. However, the company remains in a precarious financial position, making it an attractive — albeit risky — target for investors willing to restructure its debt.
At the same time, Thames Water is battling regulators over its pricing strategy. The company recently appealed to the UK’s Competition and Markets Authority (CMA), arguing for the right to raise customer bills by 53% over 2025-2030, significantly higher than the 35% increase approved by the water regulator, Ofwat. The outcome of this appeal could significantly impact the valuation and attractiveness of the utility to private equity buyers.
Thames Water has acknowledged receiving multiple bids in its ongoing equity sale process but has not publicly disclosed any potential investors. While CK Infrastructure’s bid currently leads in valuation, the role of debt restructuring and regulatory approval will be crucial in determining whether a private equity-backed takeover materialises.
Neither Thames Water nor CK Infrastructure has commented on the reports, and KKR has yet to make a public statement regarding its bid.
