A consortium of Thames Water creditors has offered the government a "golden share" giving it veto power over major decisions and hostile takeovers, in a bid to dissuade the new prime minister, Andy Burnham, from nationalising Britain's biggest water company. The move comes after Burnham signalled he wants greater public control of the debt-laden utility, with reports suggesting he is considering placing it into a special administration regime, a form of temporary public ownership.

London & Valley Water, which represents 100 institutional investors holding £17bn of Thames Water's £21bn debt, is proposing a revised £10bn rescue package that includes forgoing dividends for ten years and expanding the social tariff to help struggling customers. Thames Water serves 16 million customers across London and the Thames Valley and has struggled under heavy interest payments since privatisation, following a collapsed sale attempt to KKR last year; the creditors say a government-led special administration could cost taxpayers around £2bn, while the deal has also faced scrutiny after former environment secretary Emma Reynolds raised concerns with regulator Ofwat before being replaced by Angela Eagle this week.