Eskom should sell its power stations

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Eskom should sell its power stations

Eskom Holdings SOC Ltd. should consider selling two coal-fired plants that rank among the world’s biggest to repair the state-owned utility’s finances, according to the head of South Africa’s biggest bank by market value.

The supplier of almost all of South Africa’s power is being battered by declining sales, high fixed costs, surging debt and unplanned outages that are holding back economic growth. Its two new power plants, Medupi and Kusile, are still unfinished after a decade of construction. Combined, Eskom estimates they’ve cost 292.5 billion rand ($20.6 billion) to build.

Bloomberg
 
konfab said:
The Chinese or Russians maybe.
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I know fokkoli about business but i am of the understanding that if you buy assets you also purchase the liability. In this case the 400 plus billion rand debt.
Like i said, i know zero about business, i yawn at it :)
 
That's a great idea. Then they can sell capacity back to us at 3 or 4 times the price when Eskom continues to fail.
 
Chuckmyster said:
I know fokkoli about business but i am of the understanding that if you buy assets you also purchase the liability. In this case the 400 plus billion rand debt.
Like i said, i know zero about business, i yawn at it :)
Click to expand...

That would only apply if they sell Eskom. If they sell off assets to a new firm, then it shouldn't carry over. Barring any debt owned by that asset. I think. :)
 
they could do that, send load shedding into an even worse state than its currently in,

and force the chinese or russians to OWN south Africa for the next generation.

maybe SA richest man, has a point, this generation is useless and will just kill its chances of succeeding where others have failed.
 
Chuckmyster said:
I know fokkoli about business but i am of the understanding that if you buy assets you also purchase the liability. In this case the 400 plus billion rand debt.
Like i said, i know zero about business, i yawn at it :)
Click to expand...


A business with a colossal operating profit and the ability to turn around the stations would be pretty interested in such a deal as they would be able to offset the profit with that loss and pay less taxes.

-edit. A consortium of the mining and industrial companies in this country could easily pull something like this off. And they would benefit from the stabilized power.
 
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Can sell medupi or kusile, use proceeds to pay down debt, but then there isn't really anything left in Eskom worth keeping so unless the sale is enough to quash the debt the taxpayer would still be on the hook.
 
We need a couple of Nuclear Power Stations (not the Russian ones) on the far West coast.
Must be built WITHOUT tender, by a contractor appointed by a panel of leading scientists in the field.
Let's solve these power problems once and for all.
Coal power is outdated and the filthiest form of power there is.
 
Our infrastructure isn't setup for something like this. How would you handle the distribution from different providers? They'd probably need to sell a whole channel up to certain sub-stations, in which case the whole competition idea goes out the window.
 
konfab said:
A business with a colossal operating profit and the ability to turn around the stations would be pretty interested in such a deal as they would be able to offset the profit with that loss and pay less taxes.

-edit. A consortium of the mining and industrial companies in this country could easily pull something like this off. And they would benefit from the stabilized power.
Click to expand...

But at the end of the day, the South African people will pay out of their rear ends for this capacity. A better approach would to make the entire market free. Eskom will still be a lame duck, and sit with a ton of debt it cannot pay back, but at least the economy and everyone else can move on.

LazyLion said:
We need a couple of Nuclear Power Stations (not the Russian ones) on the far West coast.
Must be built WITHOUT tender, by a contractor appointed by a panel of leading scientists in the field.
Let's solve these power problems once and for all.
Coal power is outdated and the filthiest form of power there is.
Click to expand...

This analysis was done, and it is unaffordable. Scientists are also not business people and cannot help build funding models for such an undertaking.
 
GhostSixFour said:
Our infrastructure isn't setup for something like this. How would you handle the distribution from different providers? They'd probably need to sell a whole channel up to certain sub-stations, in which case the whole competition idea goes out the window.
Click to expand...

I think the idea would be to sell the power stations off and then those privately owned power stations sell the power back to Eskom to redistribute.

Kelvin power station is privately owned.
 
NarrowBandFtw said:
eh?

The article mentions Firstrand which is second to SBSA in terms of assets / market cap, c'mon Bloomberg, not that hard to get these things right ...
Click to expand...
So Firstrand is now Secondrand?
I know nothing about business, best I keep my trap shut :)
 
ISP cash cow said:
I think the idea would be to sell the power stations off and then those privately owned power stations sell the power back to Eskom to redistribute.

Kelvin power station is privately owned.
Click to expand...

Ahhh. That makes more sense. That could work then, I think.
 
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