A High Court judge has approved a £3 billion loan for Thames Water, averting immediate collapse and providing a temporary financial solution.

Since its privatization in 1989, the company's debt has surged from none to over £16 billion, largely due to ownership changes and rising interest payments.

The emergency restructuring plan includes £1.5 billion in immediate funding and another £1.5 billion available at the high interest rate.

The approval, announced on February 18, 2025, is crucial for Thames Water, which was at risk of running out of money by the end of March 2025.

This emergency debt package is part of a restructuring plan that allows Thames Water to continue investing in its network and making essential infrastructure upgrades.

Liberal Democrat MP Charlie Maynard criticized the restructuring as a short-term fix that fails to address long-term infrastructure needs.

Thames Water serves approximately 16 million customers in the UK and requires £3.3 billion over the next five years to sustain its operations.

The UK government is closely monitoring the situation, with some campaigners calling for nationalization to resolve the ongoing financial issues.

Thames Water's debt has escalated to approximately £19 billion, driven by rising interest rates and inflation-linked debts, alongside demands for better investment to address sewage spills.

Public discontent is growing, especially as Thames Water executives received significant bonuses last year amid the financial crisis.

Mr Justice Leech emphasized the necessity of the restructuring plan to ensure the uninterrupted provision of vital public services.

Critics have raised concerns about the high interest rate of 9.75% on the loans, arguing that it benefits creditors more than the company itself.