Thames Water has been criticised by a senior judge for not "arranging their affairs in proper order" as a date was set for a challenge to the company’s £3 billion bailout plan.
A High Court judge ruled earlier this week that the stricken utility could press ahead with an emergency restructuring scheme to save it from imminent financial collapse and a likely special administration rescue by the Government.
The plan will provide £1.5 billion of immediate life saving funding, with a further £1.5 billion potentially available on a 9.75% interest rate.
But that ruling is being appealed by a second group of creditors, who objected to the rescue plan and presented their own alternative proposals.
At the Court of Appeal on Friday, lawyers for Thames Water Utilities Holdings Ltd (TWUH), the parent company of Thames Water Group, asked for a fast-track appeal to be heard on Monday, March 3.
But barrister Andrew de Mestre KC, for TWUH, was met with a furious blast from Sir Geoffrey Vos, Master of the Rolls, for trying to "dictate" to the court.
"The court is not here to be bounced into hearings by parties who don’t arrange their affairs in proper order", he said. "That is what is sticking in my craw at the moment".
He told Mr de Mestre: "It’s not for you to dictate when this court sits", and, visibly annoyed, he added: "We have other business in this court. Really important appeals by people who have looked after their own affairs."
When he ruled on Tuesday in favour of the bailout plan, Mr Justice Leech was highly critical of enormous fees, interest and other costs of the restructuring scheme running to hundreds of millions of pounds which he described as “eye-watering.”
He added: “Customers and residents who are struggling with their bills will be horrified at these costs and mystified how the Thames Water Group has been able to fund them or why it has agreed to do so.”
Sir Geoffrey pointed out on Friday ”you could have started all of this earlier, and then you wouldn’t have put the court under pressure.”
The ruling said the total bill for the restructuring could hit £800 million, including £210 million of legal and other advisory fees.
An initial tranche of £1.5 billion will give Thames Water enough money to survive until September. The company is around £16 billion in debt and has warned it will run out of cash by March 24, when it has to repay £224 million to bondholders, without an emergency injection of funds.
It can access a further £1.5 billion in two tranches of £750 million, to give it sufficient financing until May 2026 if required. That will depend on the outcome of Thames’s appeal to the Competition and Markets Authority over how much it can put up bills over the next five years.
The funding will be released to Thames Water on a monthly, or on an interim basis.
The transaction will also see maturities of all Class A Debt and Class B Debt extended by two years. Currently between 19 June 2025 and 18 April 2027 seven notes or bonds mature totalling requiring repayment of more than £3.5 billion.
Mr de Mestre told the court on Friday that there is a ”liquidity runway”, and urged the court to expeditite the appeal hearing to avoid the rescue plan falling apart.
But Sir Geoffrey retorted that he finds it ”very very hard to believe that this cliff edge is really going to be a reality” if a hearing is held in mid-March.
”I have got to convene a court of specialist judges”, he added. ”To ask for that to happen on a particular day because affairs have not been put in order so there is a window that the court can accommodate to is frankly ridiculous.”
After a short break, the parties returned to court to agree that a three-day appeal could take place starting on March 11.
Sir Geoffrey told the court the panel of judges would ”do our best” to reach a swift judgment.
