Moody's downgrades Eskom

Moody's Investors Service has downgraded Eskom from B1 to B2.

Moody’s Investors Service has downgraded Eskom’s rating, citing a lack of clarity regarding the power utility’s plans to stabilise its finances as reasons for the decision. The rating has gone from B1 to B2.

Moody’s said in a statement:

“Despite a number of improvements at the company in relation to its corporate governance and liquidity, there is limited visibility at this juncture as to Eskom’s plans for placing its longer term business and financial position on a sustainable footing.” 

The rating also accounts for “the lack of any tangible financial support for the company in the February state budget, and the liquidity and funding challenges Eskom may continue to face,” according to Moody’s.