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Thames Water has appointed Chris Weston, former head of power supplier Aggreko, as its chief executive, as the UK’s biggest water company faces scrutiny over its financial health and probes into its treatment of sewage.
The company has been without a permanent chief executive since Sarah Bentley quit in June after a boardroom row that deepened concern about the group’s ability to manage its £18.3bn debt pile and to overhaul its ageing infrastructure.
Weston said he would be “focused on delivering the turnaround that the business has outlined and improving performance over the next few years”.
Britain’s largest water distributor is seeking to raise new equity of £2.5bn from shareholders in the coming years, in addition to £750mn already pledged. The equity is subject to bill increases that need to be approved by the regulator Ofwat.
Thames Water’s chair Sir Adrian Montague said on Thursday that Weston was taking over at “a crucial period of delivering our refocused turnaround plan and providing the service that customers rightly expect of us”.
This week Montague apologised to MPs for causing “any confusion” when the UK utility described a loan from shareholders as “equity”, as he sought to allay concern over its finances.
Thames Water faces more than £1bn in debt repayments by the end of 2024, including a £190mn facility in its parent company Kemble Water Holdings maturing in April, according to its accounts published in November.
Recruiting Weston is “one of the things [Thames Water] had to do given the multitude of challenges”, said Martin Young, an analyst at Investec. “It’s a small step in the right direction.”
Weston, who also previously led British Gas, is a former member of the army and holds a doctorate and masters in business administration from Imperial College London. He replaces Cathryn Ross and Alastair Cochran, who had been interim co-CEOs following Bentley’s exit.
He will be paid a salary of £850,000 and eligible for a bonus of 156 per cent of his salary if he meets undisclosed performance targets.
Thames Water, which launched its three-year turnaround plan this month, is also under investigation by Ofwat over a £37.5mn dividend it paid in October.
Along with other water companies, it faces legal and regulatory investigations by the Environment Agency and Ofwat into whether it breached laws on the treatment of sewage and the pollution of rivers.
Shareholders have asked for restrictions on regulatory fines as one of the conditions for injecting new equity. Its largest shareholder, the Canadian pension fund Omers, took a 30 per cent writedown on its stake last year, casting doubt over its willingness to back the company further.
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