Friday, November 12, 2010

State assets won’t be liquidated to fund Eskom

There is new information about the previously mentioned loan to Eskom.
Government’s R20 billion equity injection into Eskom will not be funded by liquidating non-core state assets after all. Government communicators have conceded they made an error with their earlier statement to that effect, and said the funding will actually come from Finance Minister Pravin Gordhan’s budget process.

News of the additional funding comes two weeks after Gordhan announced the extension of a loan guarantee to the power utility which now totals R350 billion. In an email under the heading “urgent correction” a government communicator said a recommendation to liquidate non-core state assets to fund an Eskom equity injection was not approved by Cabinet’s Economic Cluster.

Government’s Spokesperson Themba Maseko said the equity injection is aimed at helping Eskom with its balance sheet. “We believe that we’re strengthening Eskom’s ability to go to the markets to raise additional capital so that it can continue with the building programme,” he said.
Maseko said they intend to remove all doubts on Eskom’s ability to keep the lights on.

Article Via Eye Witness News

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