Futuregrowth stance on SOEs not fazing Transnet
Transnet said it was in a healthy liquidity position despite Futuregrowth announcing its intention to suspend additional debt finance to state-owned companies in SA.
|||Johannesburg - Transnet on Thursday said it was in a healthy liquidity position following one of its lenders, Futuregrowth, announcing its intention to suspend additional debt finance to state-owned companies in South Africa because of its concerns about their governance and oversight issues.
“Transnet is available to engage with all its lenders and investors, including Futuregrowth, to address any concerns they may have regarding the company's business activities,” spokesperson Molatwane Likhethe said. “It is regrettable that Futuregrowth, which represents about 1.25 percent of our total borrowings, opted to overlook the channels of communication available to them. Transnet unfortunately learnt of their decision to halt loans to SOCs through the media.” Likhethe said
Transnet was continuing to pursue its R340-R380 billion infrastructure investment programme, the Market Demand Strategy (MDS), aimed at strengthening the country's railway, ports and pipelines infrastructure.
He said Transnet had a diversified funding approach through a number of sources, depending on market conditions. These included the Domestic Medium-Term Note programme, Global Medium-Term Note programme, Export Credit Agencies, Development Finance Institutions and other financial institutions. “To support the successful execution of the MDS, Transnet raises funding through domestic and international debt capital markets, on the strength of its financial position with no government guarantees since 2005,” Likhethe said.
“Transnet has already funded its full borrowing requirement for the 16/17 financial year and has a healthy liquidity position, with R22 billion available at present.”
Meanwhile, Old Mutual, the parent company of Futuregrowth, has since distanced itself from the statements that were made by its subsidiary on state-owned companies, saying they did not represent the broader views of Old Mutual.
African News Agency