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Treasury starts EFC bidding process

The National Treasury has started a pre-qualification process for bids for Eskom's mortgage unit as part of a bigger plan to dispose of the non-core asset in order to steer the power utility to financial sustainability, Eskom spokesperson Khulu Phasiwe confirmed yesterday. According to the Treasury, the Eskom Finance Company (EFC) has an R8.7 billion loan book. The department said it was considering the sale of shares in the Eskom Finance Company through a competitive tender process.

Eskom established the EFC in 1990 primarily to enable employees to have access to home loan finance while optimising homeownership costs to Eskom and its employees. But, in the face of financial difficulties, Eskom has been contemplating the disposal of the unit. “Eskom has been considering a number of options and the EFC is one of the assets that is easily identifiable. It is not a core asset,” said Phasiwe.

He said the market would determine its price, but the disposal of the asset should not affect the conditions of employment of the EFC employees. “The terms of its customers should also remain unchanged for a certain period,” he said. Transnet sold its housing loan book to FirstRand in 2007 for R1.4 billion.

Source: www.iol.co.za

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Treasury starts EFC bidding process

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