Beleaguered Thames Water’s parent company Kemble has had its credit rating slashed by Moody’s, which warns that it could default on its loans in May.

Moody’s said it downgraded Kemble’s credit worthiness by four notches from B3 to Ca, its second lowest score. While it defines B3 as a “high credit risk”, the Ca rating means that Moody’s regards Kemble as “highly speculative and likely in, or very near, default”.

The ratings agency said it acted in response to the refusal of Kemble’s shareholders last week to make good on promises to inject £500million into the business.

Kemble is crippled by £18billion of debt and says it has suspended interest payments on its bonds or IOUs, which Moody’s says could result in a default in May. Moody’s also noted that Thames Water’s owner has also asked its lenders for more time to repay a £190million loan as it says it cannot do so by the April 30 deadline.

Kemble is crippled by £18billion of debt and says it has suspended interest payments on its bonds or IOUs, which Moody’s says could result in a default in May. Moody’s also noted that Thames Water’s owner has also asked its lenders for more time to repay a £190million loan as it says it cannot do so by the April 30 deadline.