Tear Sheet: Eskom Holdings SOC Ltd

Following Eskom?s failure to conclude the disposal of Eskom Finance Company--one of the conditions set under Debt Relief Act--government transfers to Eskom will now be ZAR2 billion lower than earlier projected. Subject to compliance with conditions as set under the act, Eskom will now receive advances of ZAR76 billion (earlier ZAR78billion) in the fiscal year ending March 31, 2024 (fiscal 2024), ZAR64 billion (previously ZAR66 billion) in fiscal 2025, and ZAR40 billion in fiscal 2026. The government will also assume up to ZAR70 billion of Eskom?s debt in fiscal 2027. To date, the government has given about ZAR66 billion to Eskom, of which ZAR16 billion has been converted into equity. In our view, this support will help Eskom to cover

...March 26, 2024 Support from the Eskom Debt Relief Act will allow Eskom to maintain sustainable leverage of about 5.8x by 2025 and reduce its refinancing and liquidity risk, although its cash flow will remain subdued. Following Eskom's failure to conclude the disposal of Eskom Finance Company--one of the conditions set under Debt Relief Act--government transfers to Eskom will now be ZAR2 billion lower than earlier projected. Subject to compliance with conditions as set under the act, Eskom will now receive advances of ZAR76 billion (earlier ZAR78billion) in the fiscal year ending March 31, 2024 (fiscal 2024), ZAR64 billion (previously ZAR66 billion) in fiscal 2025, and ZAR40 billion in fiscal 2026. The government will also assume up to ZAR70 billion of Eskom's debt in fiscal 2027. To date, the government has given about ZAR66 billion to Eskom, of which ZAR16 billion has been converted into equity. In our view, this support will help Eskom to cover its debt servicing and repayment obligations...

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