Abu Dhabi wealth fund writes off 9.9% stake in struggling Thames Water, FT reports
Adds Thames Water's response in paragraph 5
Oct 8 (Reuters) -Abu Dhabi's sovereign wealth fund, one of the largest shareholders in Thames Water, has written off its nearly 9.9% stake in the troubled British utility, the Financial Times reported on Tuesday.
Heavily indebted Thames, which serves 16 million people in and around London, is at the centre of a crisis over relentless sewage dumping, crumbling pipe networks and huge debts.
The accounts filed in June by a Luxembourg-registered unit of the Abu Dhabi Investment Authority (Adia) said that it had disposed the stake due to challenging regulatory environment and operational performance, as per the newspaper.
Adia wrote down the value of its stake in the utility from 263 million pounds ($344.21 million) to just 1 pound at the end of last year, the report added citing company accounts. It has also taken a full writedown on a 31 million pounds loan awarded to one of the holding companies that owns Thames, according to FT.
Adia and Thames Water declined to comment on the writedown, when contacted by Reuters.
The reported move comes just as British finance minister Rachel Reeves is due to announce her first budget on Oct. 30, where UK business groups expect the minister to strike a positive tone in order to give businesses the confidence to invest in the country.
Adding to the woes, last month, credit rating agencies S&P and Moody's slashed the rating of Thames Water with both firms warning that it was fast running out of money and was on the brink of default.
Without a rescue plan, Britain's government and water regulator Ofwat would likely need to put Thames into a so-called special administration regime (SAR).
($1 = 0.7641 pounds)
Reporting by Pretish M J in Bengaluru; Editing by Shailesh Kuber
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