(Bloomberg) -- A group of creditors of Thames Water’s operating company have picked advisers for potential restructuring talks. 

The investors chose Jefferies Financial Group Inc. as a financial adviser and Akin Gump Strauss Hauer & Feld LLP for legal representation, said people familiar with the matter, who spoke to Bloomberg on the condition of anonymity. The creditors own private and public bonds from Thames Water Utilities Ltd. 

The moves comes as parent company Kemble Water Finance Ltd. defaulted last week on about £1.4 billion ($1.8 billion) of debt after failing to make an interest payment, the latest escalation in a crisis at the UK’s largest water utility. 

Lenders and bondholders to the operating companies, a ring-fenced group previously seen as insulated from the parent’s troubles, have begun coordinating ahead of potential debt talks with the firm. Forming groups would streamline talks and potentially give creditors more clout in dictating terms.

A spokesperson for Jefferies declined to comment, as did Thames Water. A representative of Akin didn’t immediately return a request for comment. 

While tight utility regulation means that Thames Water should continue to operate even though its parent company has defaulted, investors want to protect themselves in case the restructuring might spread to the rest of the group. 

Read More: Thames Water Creditors in Talks to Group Up After Kemble Default

Thames Water’s bonds plunged in recent weeks after shareholders rejected plans to add fresh cash to aid the company’s turnaround. First-lien bonds due in 2031 are quoted at around 87 pence on the sterling and second-lien notes are quoted at 55 pence, according to pricing compiled by Bloomberg. 

--With assistance from Irene García Pérez and Eamon Akil Farhat.

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