Nada como uma estatal

After years of poor management and under-investment, Eskom, which generates 95 per cent of South Africa's electricity, has been forced to implement regular power outages as its aging infrastructure breaks down while demand outstrips supply.

Standard & Poor's, the rating agency, has downgraded Eskom, South Africa's beleaguered state utility, to non-investment grade, or junk status, on Thursday following the company's controversial decision to suspend its chief executive.

The move is the latest blow to the state-owned entity, which is battling to keep the lights on in Africa's most advanced economy as it grapples with a power crisis and a multibillion dollar funding gap.

S&P said it was downgrading Eskom's long-term local and foreign currency ratings to BB+ from BBB- after reassessing the utility's management and governance to "weak" from "fair." BB+ is the agency's highest non-investment grade rating.

The agency said Eskom's rating outlook was negative.

Last week, Eskom shocked bankers and analysts by announcing it was suspending Tshediso Matona, its chief executive, as well as the group's finance director and two other executives while an independent inquiry was launched into the organisation's poor performance.

Mr Matona had only taken up the post in September and analysts said the move was only likely to create more instability at the utility as it battles a crisis.

After years of poor management and under-investment, Eskom, which generates 95 per cent of South Africa's electricity, has been forced to implement regular power outages as its aging infrastructure breaks down while demand outstrips supply.

The crisis deepened this year, and is blamed for heaping more woe on an already struggling economy with the outages hitting businesses and households.

It is still not clear who will conduct the inquiry, which Eskom said would take three months.

In addition, it is facing a R225bn ($18bn) funding gap to 2018 and has been struggling to source and buy vast amounts of diesel for gas turbines. The turbines would normally only run for a few hours at peak times but are now providing critical support for the struggling system.
http://www.ft.com/fastft/294693/post-294693