Nene elaborates on assets up for sale to fund Eskom
Government has identified the nonstrategic assets that wIll be sold to fund State-owned power utility Eskom.
In a reply to a Parliamentary question by opposition party Democratic Alliance MP Dr Malcolm Figg, Finance Minister Nhlanhla Nene said the National Treasury had identified a range of assets, valued at more than R250-billion, that could be disposed of to fund the ailing parastatal.
These included directly held listed shareholdings, listed stakes held through develop-ment finance institutions (DFIs) and unlisted shareholdings in State-owned companies (SOCs) or their subsidiaries.
Government was planning to sell in assets valued at R23-billion.
Treasury would also look at ringfencing and selling assets held by SOCs and the sale of other assets, such as property owned by the State.
In March, Nene said the Treasury had approached about 20 financial institutions, mainly banks, for assistance in identifying the nonstrategic State-owned assets that should be sold.
The allocation of a comple-mentary package to strengthen Eskom’s financial position would be made in three tranches, with the first tranche of R10-billion slated for this month.
“The financing of the R23-billion will be deficit neutral as per the original intent. The process of raising the funds through the sale of noncore assets is firmly on track and details will only be made public at an appropriate time,” the Treasury said in a statement last week.
In addition, govern-ment signalled that it would convert the subordinated loan it previously extended to Eskom into equity, which would further strengthen its balance sheet.
These interventions formed part of the government support package, which also included cost-cutting or efficiency measures to be instituted by Eskom, and appropriate tariff adjustments in line with the regulatory process.
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