Moody's: Eskom notes Baa2

Moody's Investors Service said it assigned a definitive Baa2 long-term senior unsecured rating to the $1.75 billion of 5.75% senior unsecured notes due 2021 of Eskom Holdings Ltd.

The outlook is stable.

The rating is a result of the direct, unconditional, unsubordinated and unsecured obligations of the issuer, Moody's said.

The rating reflects the strategic importance of Eskom to South Africa as its dominant vertically integrated utility, the agency said, but at the same time incorporates the execution risks related to a large and prolonged program of capital investment needed to build out essential electricity infrastructure in South Africa.

Eskom has suffered from a weakened financial profile in recent years, but a number of measures were taken in 2010 to strengthen the company and enable it to continue its investment program, Moody's said.

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