Eskom's cash runs dry
Utility has 20 times less cash than needed and may be unable to pay salaries by January
Eskom is in a precarious financial position and is desperately trying to avoid a liquidity crisis that may by January render it incapable of paying staff salaries and suppliers.
The power utility confirmed on Monday that it had 20 times less cash than needed to fund operations and said it had written to the public enterprises minister, alerting her of the impending calamity.
By the end of January, the utility will run on a cash deficit of R5bn. This eventuality will come to pass even as Eskom expects to successfully draw R3.8bn from existing credit facilities over the next few weeks.
Business Day can also reveal that the race to stave off insolvency began in earnest in July, with Eskom holding meetings with its shareholder minister and the finance minister. This was 10 days after Eskom chairman Zethembe Khoza had publicly denied there was any risk of a shortage in working capital.
If you are already a subscriber, please click on the following link below to go to the full article: Eskom runs out of cash as loan facilities dry up
If you would like to subscribe to BusinessLIVE Premium to read the full story, please click here