Eskom welcomes Fitch's BBB+ rating - CNBC Africa

Eskom welcomes Fitch's BBB+ rating

Southern Africa

by Trust Matsilele 0

Eskom welcomes Fitch’s Issuer Default Rating. PHOTOS: Getty Images/Eskom

Eskom’s finance director, Tsholofelo Molefe said Eskom was pleased that Fitch acknowledged the support package as having a stabilising impact.

(READ MORE: S.Africa cabinet approves Eskom rescue package)

“Eskom, together with the Inter-Ministerial Committee, will continue to address solutions to the long-term sustainability of [the power utility] within the sector,” said Molefe.

Tshediso Matona, Eskom’s Chief Executive said the package would be useful in the power utility’s execution of planned funding initiatives.

“This affirmation will assist Eskom in its endeavours to execute the planned additional funding initiatives and ensure that we secure the funding required to effectively complete the current capex programme,” said Matona.

(READ MORE: Eskom facing liquidity crisis as privatisation looms)

Fitch Ratings affirmed Eskom’s long-term local currency Issuer Default Rating (IDR) at ‘BBB+’, with a Negative Outlook.

Fitch cited that the government support demonstrated through the 350 billion rand Guarantee Framework Agreement and planned equity injection, the company’s cost cutting and efficiency measures and the moderately supportive tariff determination as the key drivers of the rating affirmation. 

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