Thames Water non-exec director to step down amid bailout trouble

(Reuters) -Thames Water's non-executive director, Michael McNicholas, who represents Canadian pension fund OMERS on the board, is stepping down immediately, Britain's biggest water utility said on Thursday, as it struggles to secure an equity bailout.

Sky News on Wednesday reported that some of the company's shareholders were expected to quit the board after they refused to inject more than 3 billion pounds ($3.79 billion) of equity.

OMERS, or Ontario Municipal Employees Retirement System, holds a nearly 32% stake in Kemble Water, making it the largest external shareholder in Thames's parent firm, as per its website.

Thames Water, which supplies to about a quarter of the British population, was thrown into crisis earlier this year when its shareholders refused to provide a 500 million pound equity lifeline to stabilise its finances.

A number of board members at companies connected to Kemble Water are expected to resign in the coming days, the Sky News report said.

It is not immediately clear who or how many shareholders are expected to exit the board.

"Thames Water continues to meet water regulator Ofwat's expectation that independent non-executive directors form the largest single group on the Board," the utility said in a statement.

The company said in March that it had until late next year to secure more funding or risk nationalisation.

Britain's privatised water industry has come under scrutiny after sewage spills have jumped with owners being paid big dividends, loading the companies with debt.

Public outrage over pollution and the prospect of higher bills has put the regulator under pressure to ensure consumers get value for money, but investors say they still need to make returns, resulting in a stand-off over Thames Water.

($1 = 0.7913 pounds)

(Reporting by Radhika Anilkumar and Prerna bedi in Bengaluru; Editing by Vijay Kishore and Sonia Cheema)