S&P trims Eskom

S&P Global Ratings said it lowered its long-term corporate credit rating on Eskom Holdings SOC Ltd. to BB from BB+. The outlook is negative.

At the same time, S&P also lowered its long-term South Africa national scale rating on Eskom to zaBBB from zaA while affirming the short-term zaA-2 rating.

“The downgrade reflects our view of increased financial pressure on Eskom, which has not yet been addressed by its owner, the South African government, which puts our assessment of an extremely high likelihood of extraordinary government support at risk,” S&P said in a news release.

“Although we still believe that Eskom will benefit from considerable government support, the predictability of such full and timely government support in all circumstances is decreasing in our view,” the agency added.

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