S&P affirms Exxaro

S&P said it affirmed the zaBBB and zaA-2 long- and short-term South Africa national scale ratings on Exxaro Resources Ltd.

In addition, the agency affirmed the zaBBB South Africa national scale issue rating on Exxaro's ZAR 520 million senior unsecured bonds. The recovery rating of 3 remains, indicating an expectation of meaningful (50%-70%; rounded estimate: 65%) recovery in the event of a payment default.

“We expect Exxaro to maintain strong credit metrics and adequate liquidity despite the increased likelihood of default at Eskom and Exxaro's decision to accelerate the pace of its capital expenditure,” S&P said in a news release.

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