Eskom debt plan days away, outgoing restructuring chief says

Proposals to reorganise the R454 billion owed by South Africa’s state-owned power company are days away from completion, according to an official who’s overseen their formulation.

A report that sets out the options for dealing with Eskom's debt will be submitted to Public Enterprises Minister Pravin Gordhan, who will decide if and when to release it, Freeman Nomvalo, whose tenure as the utility’s outgoing chief restructuring officer officially ended last month, said on the sidelines of an event in Johannesburg. He declined to elaborate on the contents.

Eskom produces about 95% of South Africa’s electricity, but has been forced to institute rolling blackouts as its old and poorly maintained plants struggle to keep pace with demand. With the utility posing an ever-increasing threat to the nation’s finances, President Cyril Ramaphosa appointed Nomvalo, the head of South Africa’s chartered-accountants’ institute, to his post on July 30 last year and tasked him with repositioning its finances with a focus on its debt, revenue and cost structure.

Nomvalo’s report has been keenly awaited by Eskom’s creditors and investors, who’ve largely been kept in the dark over the government’s plans to get Eskom’s finances back on a sustainable footing.

It’s unclear whether his report will consider recent proposals by the Congress of South African Trade Unions for the state pension fund manager and state lenders to take on about R250 billion of the utility’s debt.

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