“Thames Water is said to be close to a deal with its regulator that would allow the company to avoid new fines for four years, as long as it commits to investing in the business.”

“Bosses tried to sell the company last year but faced embarrassment when their preferred bidder, KKR, pulled out of the deal at the last minute.”

“The potential deal, which was first put to the regulator in June 2025, with Thames due to run out of money again this October.”

“If approved, it would cover only potential fines levied by Ofwat, meaning the water company could still face penalties from the Environment Agency, as well as having to battle any legal cases.”

“Thames’s creditors, who provided the company with £3bn worth of emergency funding last year, are also individually negotiating pollution, leakage and other performance targets that were imposed a year ago.”

“Any deal of this kind would have to go out for a three-month public consultation, but would prove controversial, particularly at a time when its customers are facing a rise in bills of more than a third by 2030, before accounting for inflation.”

“In a statement given to the FT, creditors said: 'All outstanding fines will be paid. Regulators will have enhanced transparency, and Thames Water will have clear accountability for reducing pollution and improving environmental outcomes against stretching performance targets.'”