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BL Premium reports that the Government Employees Pension Fund (GEPF) has not taken a decision to convert its Eskom bond holdings into shares in the company, principal executive officer Abel Sithole advised on Thursday.
Earlier, Public Investment Corporation (PIC) chair Reuel Khoza said in an interview with eNCA that the PIC had submitted a proposal to the fund to convert Eskom bonds held by the GEPF into equity in Eskom. This would have the effect of reducing Eskom’s debt servicing costs substantially. “Jointly the PIC and GEPF have just under R100bn of bonds and if we could discuss with them and they met certain requirements, it would be possible to convert those bonds to equity. Then the interest that Eskom pays would be virtually halved,” he pointed out. However, such a proposal would need the approval of the GEPF board before it could go ahead. Pension fund holders and several large public sector trade unions have voiced strong opposition to the use of pension money to prop up state-owned enterprises. However, union federation Cosatu proposed in January that the PIC provide financial support to Eskom in the broader interests of preventing its collapse. Sithole was on Wednesday appointed as the new CEO of the PIC, where he will soon take up his position
- Read the full original of the report in the above regard by Carol Paton at BusinessLive (paywall access only)
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