Challenge to Thames Water rescue deal dismissed

A £3bn rescue loan for Thames Water is set to go ahead after an appeal against the deal was dismissed.

The troubled firm secured the rescue loan in February, to stave off the prospect of the debt-laden company coming under government control.

But a small group of lenders had argued against the terms of the deal, while Liberal Democrat MP Charlie Maynard had argued that extra lending was not in the public interest.

This extra funding allows Thames to continue operating for at least another 12 months giving it time to restructure its nearly £20bn in debt and try to attract new investment.

The reasons for the Court of Appeal's decision are yet to be released.

The BBC understands that Mr Maynard is still considering whether to appeal against this latest ruling to the Supreme Court.

Thames Water's chief executive Chris Weston said he was "pleased" with the decision.

"We remain focused on putting Thames Water onto a more stable financial foundation as we seek a long-term solution to our financial resilience," he said, adding that the firm's "turnaround plan" can continue.

He added the initial tranche of £1.5bn would be provided in instalments over the coming months.