The plan to split the company, which supplies over 90% of South Africa's electricity but is straining against the burden of heavy debts and failing coal-fired plants, is designed to smooth the firm's access to capital markets.
Eskom has debt net debt of between R460 billion and R485 billion, and is likely to record another"substantial loss" in 2021, de Ruyter said in a live address on YouTube."Why do we prioritise transmission? It's to enable us to demonstrate to private investors, in generation in particular, that their bids will be fairly adjudicated compared to legacy Eskom generation," said de Ruyter.
Some investors and analysts have said the separation could trigger a default under Eskom's current loan agreements as it involves the transfer a number of assets and liabilities. Each of the three divisions were busy finalising their balance sheets, de Ruyter said."The underlying issue is how much debt each of the divisions can and should be carrying."
"If all the actors in this ballet play their role and give us those approvals as quickly as is required, we should have the ITSMO in place within the year."