Johannesburg: Eskom, the South African power utility, has received an upgrade in its credit rating from SandP Global, elevating it to ‘B’ from ‘CCC+’ with a stable outlook on its senior secured and unsecured debt. Additionally, Eskom’s South Africa national scale rating was raised to ‘zaBBB/zaA-2’ from ‘zaB/zaB’.

According to South African Government News Agency, this upgrade is a positive response to the company's ongoing efforts in operational and financial recovery. He emphasized the importance of the collaboration with shareholder ministries and the implementation of Eskom's turnaround plan, focusing on strategic objectives such as operational efficiency, financial stability, and organizational culture.

The upgrade by the credit ratings agency is attributed to the South African government's R254 billion debt relief package, as part of the Eskom Debt Relief Act signed into law on 7 July 2023. The package is expected to cover Eskom’s debt servicing and repayment obligations over the current and next two financial years, significantly improving the company’s credit quality.

Eskom stated that the stable outlook reflects SandP Global’s anticipation that the power utility's creditworthiness will continue to benefit from explicit and timely government support. This support is expected to strengthen Eskom’s liquidity position and reduce the risk of default as the debt relief agreement is implemented as planned.