ESKOM HOLDINGS SOC LIMITED - Credit rating announcement - BIESKM

Credit rating announcement - BIESKM

Eskom Holdings SOC Limited
(Registration No. 2002/015527/06)
JSE alpha code: BIESKM
(“Eskom” or the “company”)

Credit rating announcement

Moody’s Investor Services (Moody’s) has lowered the long-term corporate family rating (CFR) of
Eskom to ‘Caa1’ from ‘B3’; and has similarly revised the rating of the zero coupon eurobonds to ‘Caa1’
from ‘B3’, in line with the CFR. In addition, the rating of the senior unsecured global medium term
notes was downgraded to ‘Caa2’ from ‘Caa1’; and the national scale rating long term CFR revised to
‘B1.za’ from ‘Ba3.za’. Moody’s outlook remains negative.

Moody’s has also downgraded the rating on Eskom’s Government of South Africa (Government)
guaranteed notes to ‘Ba2’ from ‘Ba1’.

Eskom notes with disappointment the ratings decisions applied by Moody’s. While the rating action is
largely driven by the downgrade of the Government credit rating, the rating agency also cites Eskom’s
capital structure and deepening financing needs as a challenge for the organisation. Moody’s
highlights in their assessment their assumed likelihood of strong Government support for Eskom
reflected in the equity support already provided, the presence of Government’s Guarantee Framework
Agreement and Eskom’s essential role as South Africa’s principal electricity supplier.

Eskom also acknowledges the concerns expressed by Moody’s regarding the company’s capital
structure and debt levels and continues to work closely with shareholder ministries to resolve these
challenges.

Full report by Moody’s available on: https://www.moodys.com/research/Moodys-downgrades-
Eskoms-ratings-maintains-negative-outlook--PR_436580

25 November 2020

Debt Sponsor
Nedbank Corporate and Investment Banking

Date: 25-11-2020 11:51:00
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