Eskom Has $25 Bn Hole Bonds Can’t Fill: S. Africa Credit

Eskom Holdings SOC Ltd. is facing a $25 billion funding gap over the next five years that the South African power utility may be unable to fill with bond sales, jeopardizing timetables for building plants to avoid blackouts.

Yields on the power utility’s dollar bonds due January 2021 rose for the seventh straight day yesterday after Eskom on July 10 said it would need 50 billion rand ($5 billion) more than planned to meet funding needs in the five years to 2018. The rate climbed 40 basis points to 6.04 percent in the period, versus a two basis-point rise in South Africa’s dollar debt due in March 2020 and a nine basis-point jump in the average yield of emerging-market utilities tracked by JPMorgan Chase & Co.