(Bloomberg) -- A lender to beleaguered utility Thames Water is looking to offload about £500 million ($635.5 million) of the company’s loans, according to people with knowledge of the matter. 

The debt package is set to hit the market in the coming days and includes class A and class B bilateral loans made to the operating company, said the people, who asked not to be identified because discussions were private. The seller is also trying to offload £100 million of the company’s bonds, one of the people said. 

A representative for Thames Water declined to comment. 

Thames Water has a roughly £16 billion debt pile. In April, its parent company Kemble Water Holdings Ltd. defaulted on about £1.4 billion of liabilities after shareholders said they wouldn’t inject £500 million of capital as previously planned.

Bonds issued by the company’s operating units have sunk, sparking some money managers to buy the notes last month in a bet that any haircut from a potential restructuring would prove less painful than market pricing implied. However, loans are much less liquid. 

Thames Water and its creditors were starting debt talks ahead of a key June 12 decision from UK water regulator Ofwat on the group’s next business plan. But Ofwat delayed the ruling to July 11, citing the upcoming general election. Until then, discussions are effectively on hold, Bloomberg reported earlier this week. 

The earlier date falls within purdah, a period where no new legislation or government announcements can be made to avoid interfering with the election.

(Updates comment line, Ofwat delay timeline in sixth paragraph.)

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