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South Africa’s power utility Eskom would have defaulted without PIC loan

A general view of the headquarter of the embattled South African main electricity provider ESKOM is pictured on February 4, 2015 in Johannesburg. South Africa power supply was under "extreme" pressure on February 2, 2015 and likely to remain so until end of the week after a technical fault at the country's sole nuclear plant, electricity utility Eskom said. AFP PHOTO/GIANLUIGI GUERCIA        (Photo credit should read GIANLUIGI GUERCIA/AFP/Getty Images)

A general view of the headquarter of the embattled South African main electricity provider ESKOM is pictured on February 4, 2015 in Johannesburg. South Africa power supply was under “extreme” pressure on February 2, 2015 and likely to remain so until end of the week after a technical fault at the country’s sole nuclear plant, electricity utility Eskom said. AFP PHOTO/GIANLUIGI GUERCIA (Photo credit should read GIANLUIGI GUERCIA/AFP/Getty Images)

South Africa’s Public Investment Corporation (PIC), Africa’s biggest investment fund, said on Tuesday that without a 5 billion rand ($420 million) loan it advanced to cash-strapped utility Eskom, the utility would have defaulted on its existing debts with lenders.

The PIC, which holds a large chunk of government bonds and stakes in leading South African companies, said last week it had given the country’s sole power supplier the loan to fund the utility’s operations in February.

Credit: CNBC Africa