Fitch rates Kemble Water BB-; Thames bond BB

Fitch Ratings said it assigned Kemble Water Finance Ltd. an issuer default rating of BB- and an expected senior secured rating of BB.

The agency also said it assigned Thames Water (Kemble) Finance plc's prospective bond issue, which is guaranteed by Kemble Water, an expected senior secured rating of BB.

The outlook is stable.

Kemble Water is a holding company of Thames Water Utilities Ltd., the regulated monopoly provider for water and wastewater services in London and surrounding areas, Fitch said.

The ratings reflect the regulatory environment in which Thames Water operates, its comfortable second quartile position in the water industry and the subordinated nature of financial obligations at holding company level, the agency said.

These forecast metrics are commensurate with Kemble Water's BB- issuer default rating and the expected senior secured ratings benefit from a one-notch uplift for above-average recovery prospects in case of a default, Fitch said.

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