S&P rates Eskom notes BB

S&P said it assigned its BB long-term foreign currency issue credit rating to Eskom Holdings SOC Ltd.'s up to $1.5 billion of proposed notes, to be guaranteed by the government of South Africa.

The agency said it equalizes the rating on Eskom's proposed notes with the long-term foreign currency sovereign credit rating on South Africa (BB/stable/B), based on the unconditional and irrevocable guarantee by the government.

S&P said it understands that Eskom will use the cash proceeds from the proposed notes to pay down outstanding debt under a ZAR 20 billion credit facility agreement, which was provided to finance capex among other uses, entered into between a consortium of banks and Eskom in February.

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