ESKOM HOLDINGS SOC LIMITED - Eskom ratings announcement

Eskom ratings announcement

Eskom 

MEDIA STATEMENT


Eskom notes the downgrade by Fitch of Eskom’s local currency rating; outlook
revised to stable

Monday, 14 January 2013: Credit rating agency Fitch on Friday 11 January 2013
downgraded Eskom’s local currency rating by one notch, following the downgrade by Fitch
of South Africa’s sovereign rating on 10 January 2013. Fitch has, however, revised its
outlook on Eskom from negative to stable.


Fitch conducts only local currency and national ratings for Eskom, in contrast to Moody’s
and Standard & Poor’s which do both local and foreign currency ratings. Fitch has
downgraded Eskom's long-term local currency Issuer Default Rating (IDR) and its senior
unsecured local currency rating to 'BBB+' from 'A', with the outlook revised to stable from
negative.


In its statement Fitch affirmed that Eskom’s ratings remain linked to the sovereign ratings
of South Africa, in line with the agency's 'Parent and Subsidiary Rating Linkage' criteria,
and the agency's assessment of the critical role of Eskom in the South African economy.’


Fitch also stated that future developments which could lead to positive rating actions for
Eskom included an upgrade of South Africa’s sovereign rating, provided that the strength
of Eskom’s links with the sovereign do not weaken.


Eskom has noted the action by Fitch, which follows recent downgrades by Standard &
Poor’s and Moody’s. The Fitch local currency rating remains the highest of the three
agencies and carries a stable outlook. Credit ratings by rating agencies influence the cost
and availability of Eskom’s debt.


“We have taken note of the rating agencies’ analysis of the challenges facing Eskom.
Their comments highlight the electricity industry’s need for regulatory and policy certainty,
as well as the need for Eskom to be financially sustainable,” said Eskom Chief Executive
Brian Dames.
Paul O’Flaherty, Eskom Finance Director said: “We note the ratings review and action
announced by Fitch and agree that the current support from the Government remains
strong and Eskom continues to move towards more sustainable credit parameters.”


ENDS.                                                    15 January 2013

Date: 15/01/2013 02:44:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
 the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, 
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
 information disseminated through SENS.