Today's discussion about the news
Comments
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The time when the owners were racking up debt in the company and taking dividends would seem relevant to this.
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It does look like they didn't allow enough headroom for rising interest rares.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
I await your financial analysis based on your chosen time period.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
There was a graph earlier in the thread that also covered the time macquarrie owned it, wasn't there? You can look at that and give your thoughts
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I'm sure I remember our water bills going up steeply in the early days to pay for all the capital stuff that we were told only privatised industries could finance. Seems like they didn't do the capital stuff after all, and now they tell us they can't now afford to do it without, er, raising bills steeply (again). The whole thing feels like smoke & mirrors. If their best excuse is incompetence, I'd like my money back, please.
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Tbf the government does not have a good track records running public assets well either, but I am pretty pissed off the investors think the govt will step in to save their investment.
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To be honest they should just let it fail, let the investors lose all their cash that they've pulled out of it already anyway. And buy it back for £1.
I call this the Wiggle gambit.
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You're trying to make the point, so off you trot.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
I don't think loading a company up with debt, taking dividends, then walking away and leaving it in a position to fail and renege on those debts shows capitalism working in its best light.
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Wasn't all this discussed a while ago and the conclusion was that all the debt is at hold co level and is irrelevant to the operation of the utility.
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Seems pretty relevant if the company is about to go pop.
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It seems to be the expectation of businesses and individuals since the bank bailout
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Which company? If the holding company goes pop whilst the operating company is completely fine, I doubt it will have much impact.
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The issue is the company is failing as a water company. Record sewage outflows, water leakages, and because of the debt problem investors are refusing to stump up the £3bn equity to keep the lights on (pay staff, maintenance and repairs) until ofwat agrees to allow them to charge higher prices. The shortfall is in large part due to the extra cost of debt they loaded onto it.
Argument is why should customers pay for poor financial management of a necessary utility - over 50% price rise.
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The internal divis paid in the last 5 years went towards paying interest, so that stacks up as at least some of the interest must have been in a different group company.
There could be other interdependencies between holding company and trading, but it would need a bit more of a detailed investigation of the financial position to understand the consequences, which is where KG could add some value to the debate.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
Not necessarily - see my post above.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
Why should customers pay 50% more to cover the debt costs the investors thrusted onto the company
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That's not really an analysis.
Why do you think the owners of a business would deliberately do things to make it fail?
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
Take the money and run when things get tricky. See also Glaziers at Manchester United.
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
Thats the usual phrase trotted out by lefties. If the financial woes of Thames Water are anything to go by, they investors would be running off with a fair bit less than they would like if they sold it.
And Man U are still a valuable business, unless you think you know better than Jim Ratcliffe?
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
investors are demanding to hike prices by 50% to largely cover the cost of the debt they put on the company
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I'm aware of that. They'll need get past OFWAT first - there's a statement on the OFWAT website suggesting that the investors will not get it their own way (for some reason, linking won't work).
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
I never said that they should.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
Double post
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
I’m not a leftie (as you will see after the next election), I can just see people manipulating businesses. Manchester United were in a better financial state before the Glaziers loaded them with debt. Same as Thames Water. Business men manipulating accounts for their own benefit.
The above may be fact, or fiction, I may be serious, I may be jesting.
I am not sure. You have no chance.Veronese68 wrote:PB is the most sensible person on here.0 -
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It's not complicated. Operating company keeps operating and if it has legitimate reasons to negotiate a revenue increase it does. Lenders then either retain existing shareholders or sell to someone else. Either way they take a haircut.
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Not sure why you think I know anything about it, but it's very flattering.
I just asked you a question that you haven't really answered.
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I haven't proposed anything so far, tbh can't be bothered spending the time doing the research. What's your answer?
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
As usual you haven't even stated your view so I have nothing to comment on.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0
