South East Water Ltd. is reevaluating plans to tap capital markets to raise debt after initial talks with bond investors stalled over pricing. The company, which serves more than two million customers in England, recently sounded out credit investors through bankers at Nat West Plc about buying newly issued debt, according to people familiar with the matter.

The push followed a July agreement with US credit firm King Street Capital Management, which agreed to provide £200 million ($270 million) to South East Water as a backstop for a future bond sale. The liquidity is meant to help stave off a cash crunch previously forecast for next August.

“As part of our routine financial management, we recently engaged with debt investors, which generated useful feedback and demonstrated demand for our debt,” a spokesperson said. “The board will evaluate the appropriate timing to access the market.”

Britain’s water utilities are under pressure from poor environmental performance to financial distress. South East Water’s gearing ratio of 66.5% is above Ofwat’s target, and it recently paid a £30.5 million redress package.