Railway News South Africa

Subscribe to industry newsletters

Search jobs

Transnet signs $1.5bn loan with international banks

Rail firm, Transnet has agreed upon a five-year loan worth $1.5bn with a group of international lenders led by Deutsche Bank AG in its biggest funding transaction in seven years.
Source: Col André Kritzinger via
Source: Col André Kritzinger via Wikimedia Commons

Poor maintenance, a lack of spare parts for trains, copper cable theft and vandalism have disrupted Transnet's freight rail services. It reported a 14% decline in volumes hauled in its last financial year.

In April, Transnet declared force majeure, saying its capacity to provide services to mineral exporters was constrained by a lack of locomotives, large-scale theft of copper cables and vandalism of infrastructure.

Transnet will use the loan to fund its expansion projects and refinance existing debt, it said in a statement late on Tuesday.

"This is a significant milestone to stabilise Transnet's liquidity position in support of our financial sustainability," Transnet's Group Chief Financial Officer Nonkululeko Dlamini said.

The first draw-down of $685m is scheduled for this month, Transnet said.

Africa Finance Corporation, African Export-Import Bank and Bahrain-headquartered Ahli United Bank were involved in the syndicated loan transaction alongside Deutsche Bank.

Last week, Transnet issued a veiled threat to coal exporters who had not agreed to amend transportation contracts, following its declaration of force majeure in April.


Reuters, the news and media division of Thomson Reuters, is the world's largest multimedia news provider, reaching billions of people worldwide every day.

Go to: https://www.reuters.com/

Let's do Biz