Eskom signed a US$2.5 billion (approximately R33 billion) loan agreement with the China Development Bank, the Utility said on Tuesday.
The deal was announced at a signing ceremony held in Pretoria. Eskom said in a statement the facility will form part of the funding of Eskom’s build programme and specifically the Kusile Power Station.
Befitting to the current build programme; this long-term government guaranteed facility will allow Eskom to draw down on the facility up to a period of five (5) years from the effective date.
“China Development Bank remains a valued partner and a key contributor to the progress achieved by Eskom in executing the current build programme,” said Eskom’s Group Chief Executive Phakamani Hadebe.
“This agreement cements Eskom’s long-standing relationship with China Development Bank. We view the conclusion of this facility as a demonstration of financial markets confidence in Eskom’s path to recovery and the plans to transition the company towards sustainability”.
Hadebe said the successful conclusion of this facility brings Eskom in line with the company’s commitment to imminently secure 62% of the financial year 2018/19 funding requirement, as communicated at the results presentation on 23 July 2018.
“Both local and international financial markets have demonstrated an improved appetite for Eskom’s credit and we are confident that we will fully execute the required funding for the year,” said Eskom’s Acting Chief Financial Officer, adding that the company’s liquidity levels are continuing to improve and our financial sustainability is on the mend.
