Eskom to sell R5.7 billion business

Eskom is planning to sell its staff home loan book and assets to Africanbank.

Eskom said that it has accepted a binding offer from Africanbank for its staff home loan book and assets housed in Eskom Finance Company SOC Limited and its interests in Nqaba Finance 1 (RF) Limited.

Eskom has offered home loans to its employees, with instalments deducted from their salaries.

The parties are currently in the process of concluding a sale and purchase agreement.

The disposal is subject to various conditions precedent, such as board and regulatory approvals.

The deal is anticipated to be concluded by 31 May 2025, but Africanbank warned that the timing may vary as many of these regulatory bodies are not parties to the agreement.

Eskom said that it keeps stakeholders informed regarding the conclusion of the Disposal.

“In line with Africanbank’s Excelerate25 strategy, the integration of the R5.7 billion home loan book and leveraging off Eskom established infrastructure and relationships, this acquisition aims to diversify Africanbank’s product offering and increase its capabilities and presence in the secured home loan lending market,” said Africanbank.

The deal marks another acquisition from Africanbank ahead of its proposed listing on the JSE, which has been delayed from 2025 to late 2027 at the earliest.

African Bank paid Sasfin over R3 billion for its Commercial Property Finance and Capital Equipment Finance, which were completed in August and November, respectively.

It had previously purchased Grindrod Bank in 2022, marking its entrance into business banking.

The group, which faced near collapse in 2014, recently saw its net profit jump from R521 million in financial year 2023 to R523 million in FY24.

Eskom, on the other hand, needs to raise revenue, with the sale of its home loan business a condition of the government’s R254 billion bailout package for the state-owned entity.

Eskom has recently proposed a revenue and price increase of 66% over the next three years, which equates to:

• 36.15% on April 1, 2025;
• 11.91% on April 1, 2026;
• 9.1% on April 1, 2027.

These increases have not been well received by the public.

Energy regulator Nersa has been holding public hearings on Eskom’s tariff application, with feedback from customers and stakeholders wholly rejecting the amount being asked for.

OUTA said that Eskom is pushing massive price hikes onto customers while not doing enough to tidy up its own operations and find cost savings by being more efficient.

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