7 May 2026
What does the ‘Ultimate Controller’ mean?
According to Water Regulator Ofwat, the Ultimate Controller is "any person which, whether alone or jointly and whether directly or indirectly, is, in the reasonable determination of Ofwat, in a position to control or in a position to materially influence the policy or affairs of the Appointee or any Holding Company of the Appointee".
In brief, the Ultimate Controller is whoever materially influences the policy and direction of a water company.
Designating an Ultimate Controller is a core part of the regulatory system. It enables the regulator - and the public - to identify who is controlling our water supply, and in what interests. As a result, determining the Ultimate Controller is a cornerstone of applying regulatory checks and balances on corporate interests, and protecting billpayers and our environment.
Because of this, the regulator (Ofwat) is supposed to formally approve any changes in the Ultimate Controller of a Water Company.
However, in the case of Thames Water, the question of the Ultimate Controller is hotly contested, with Ofwat and a number of MPs disagreeing over who holds the designation.
Who is the Ultimate Controller of Thames Water?
Typically, the shareholders are designated as the Ultimate Controllers of a water company. The rationale - in a privatised system - is that shareholders have a vested interest (profit-making) in the company doing well.
However, Thames Water’s shareholders have walked away from the utility, calling it ‘uninvestable’. They have written down their shares to zero, and removed their representatives from Thames Water’s Board.
Which has raised the question - who is controlling Thames Water in their absence?
Charlie Maynard - Liberal Democrat MP for Witney - began raising this question early last year. He made the case that Thames Water’s creditors - the very same creditors who are now asking for a holiday from the regulations as part of their takeover bid - have now become de facto controllers of the utility.
Following that - in July 2025 - MPs on the EFRA (Environment, Food and Rural Affairs) committee raised the question with Adrian Montague (Thames Water’s Chairman). Montague himself admitted that ‘bizarrely’ the shareholders were still considered the utility’s Ultimate Controllers, even though ‘they are not taking any active part’, and the Board has no day-to-day contact with them.
Alistair Carmichael MP - the committee’s chair - responded that ‘it is not that they are not very active; they do not exist anymore. I can do the whole Monty Python dead parrots sketch for you if you want, but that is a controller that has ceased to be.’
The Business and Trade Committee has also made the same case. In a letter to Ofwat, Liam Byrne MP highlights the ‘active role’ that the creditors have made in Thames’ restructuring, and questions exactly how Ofwat are making their decision on the Ultimate Controller designation.
Ofwat responded, denying claims that the creditors have become the Ultimate Controllers of Thames Water. But the facts just keep stacking up:
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The shareholders - currently designated as Ultimate Controllers - have no role in the running of the utility. They are ‘a controller that has ceased to be’.
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The creditors, on the other hand, are actively involved in the restructuring of the utility
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Previously Ofwat has denied that the creditors meet the definition of Ultimate Controller by describing them as an ‘informal collective’ who are ‘not formally co-ordinating together’. Yet now the creditors - who are calling themselves the ‘London and Valley Water Consortium’ - are very much a formal, coordinated group.
Why does it matter?
The creditors are a group of US hedge funds, who specialise in making money out of financial collapse. They include:
- Elliott Management - who were instrumental in moving BP away from renewables. Their CEO - Paul Singer - is a Trump megadonor.
- Silver Point Capital
- Farallon Capital Management
These creditors do not live in the Thames Water region, and do not have to suffer the consequences of running our water infrastructure into the ground for profit. If they are not designated as Ultimate Controllers of Thames Water, they are not being held accountable for the decisions they make about our water supply.
Also, they do not have a vested financial interest in the company performing well, as shareholders do. They are simply lenders, who will make their money when Thames Water is sold.
This is of absolutely crucial importance right now, as the creditors negotiate for the future of Thames Water. They are hoping to maximise their profits by brazenly manipulating the regulatory system for their own ends, and setting a new low on sewage pollution - one which will affect every single household in the UK.
We cannot allow faraway hedge funds to destroy our water system in their own financial interests.
Take action now:
Email your MP: urge them to say NO to the creditors’ deal
Email Ofwat: the Board must reject the Thames Water creditors
