Thames Water owner hit by second credit rating downgrade in six months

Moody's move comes as it warns of materially' increased risks that regulators will block dividend flow

Thames Water's parent company has been hit by a second downgrade to its credit rating in six months, with Moody's warning of materially" increased risks that regulators will block the flow of dividends.

The watchdog Ofwat is considering whether to investigate Thames for a potential breach of its licence when it paid a 37.5m dividend in October, as revealed by the Guardian last week. The cash was paid from the core operating company that serves 16 million customers across London and the Thames Valley to a holding company.