Eskom group CEO Phakamani Hadebe. Picture: FREDDY MAVUNDA
Eskom group CEO Phakamani Hadebe. Picture: FREDDY MAVUNDA

Eskom has been removed from Fitch Rating’s “rating watch negative” list, reducing the risk the power utility's credit rating being cut to Fitch’s fourth tier of junk in the near future.

Fitch informed Eskom that its credit rating remains BB- with negative outlook, the state-owned enterprise (SOE) said in a media release on Friday.

“The decision to affirm the rating and remove the rating watch negative (RWN) on Eskom is a positive indication of the ratings agency’s view that Eskom has made significant progress towards improving the company’s liquidity health and resolving corporate governance challenges that plagued the company,” Eskom said.

By the end of September, Eskom had secured about 72% of the R72bn it needs to borrow in its 2019 financial year and is fairly confident it can raise the remainder.

“The ratings action is an affirmation of extensive measures  implemented by the company’s leadership in transitioning Eskom from business-as-usual towards sustainability,” Eskom CEO Phakamani Hadebe said in the media release.

“This reflects the start in our journey towards restoring financial health, however, the road ahead will be tough. Eskom remains a vital contributor to ensuring that SA’s economic growth targets are achieved and that security of supply remains one of our key priorities”.

laingr@businesslive.co.za