Eskom handed R5 billion lifeline
Eskom has been handed a R5 billion lifeline after the Public Investment Corporation (PIC) agreed to loan the power utility money to cover its costs.
The PIC, in a joint statement with the Government Employees Pension Fund, says an agreement was reached to cover the cash-strapped utility's operational costs for the month, after it was approached by Eskom.
In its statement, PIC says Eskom is experiencing enormous liquidity constraints, which are threatening the company's existence.
Eskom has welcomed the news of the bailout.
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Eskom spokesperson Khulu Phasiwe believes this is step in the right direction for the power utility.
"This is an indication that financial institutions, especially in SA, are beginning to have faith in Eskom again which is what we were saying all along.
"That once Eskom can give some sort of assurance that it is dealing with the issues of corporate governance within the company, they will start talking to Eskom. This is the evidence of that matter now."
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Releasing its interim results, the power utility revealed it would need a total of R20 billion to keep going.
The PIC also says three commercial banks have indicated their willingness to extend credit facilities to Eskom, subject to the outcome of their respective due diligence processes.
Phasiwe is optimistic that they will manage to secure the rest of the funds.
"This is the first of many chances of deals we will be securing over the next few days and weeks, so we can close this funding and get R20 billion."