Eskom secures largest syndicated A/B Loan in Africa

Author: Edward Price | Published: 26 Jul 2016

The African Development Bank (AfDB) has extended $1.34 billion loan facilities to South Africa’s Eskom to support the utility's capital expenditure programme. It is  to date the largest syndicated A/B Loan arranged in Africa.

The loan featured a state guarantee from South Africa. According to Annemarie Mecca, chief legal counsel at AfDB who worked on the deal, the sovereign guarantee incorporates the typical provisions seen in a guarantee. But it is also atypical from the perspective of commercial banks, in that it is governed by public international law while the loan agreement itself is governed by English law.

AfDB and Eskom have previously worked together on four separate occasions, including three public sector loans to Eskom totalling over $1.35 billion.

According to a press release from the AfDB, the expenditure programme includes investments in new generation, plant refurbishment, transmission lines, and...



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