UPDATE 3-S.Africa's Eskom to start search for new CEO
* Credible and respected leaders needed - analyst
* Acting chairman, minister say Maroga no longer CEO
* Minister says proper steps were taken to resolve crisis
(Adds government minister comments, paragraphs 11-12)
JOHANNESBURG, Nov 12 (Reuters) - South African power utility Eskom said on Thursday it would start looking for a new chief executive officer after Jacob Maroga quit the post, ending a long leadership battle at the troubled state-owned group.
The crisis at Eskom [ESCJ.UK] could however still unnerve mining firms and foreign investors, uncertain whether the company will be able to supply enough power to run mining operations after the national grid ground to a near halt early last year.
The loss of Maroga and of Eskom's chairman, Bobby Godsell, this week raised questions over the government's ability to run state-owned firms as key roles at various enterprises are still unfilled while the companies struggle to resolve internal battles.
Eskom's acting chairman, Mpho Makwana, told a news conference that he had been entrusted to run the company until the appointments of a new chairman and CEO and that the government stood fully behind the group's board.
The utility hoped to find a candidate for the CEO post within 90 days, Makwana said.
"There is an urgent task at hand to heal the organisation and to restore the organisation's credibility with all its key audience," he added.
"It is unfortunate, but we can turn it around ... It's not irreparable," Makwana later told Reuters.
POLITICAL MEDDLING
Analysts said the departure of Godsell suggested political meddling and markets would only regain confidence in Eskom if two credible new leaders were appointed.
"The appropriate choice for the two positions is the only way that markets can regain confidence in the company, its debt issuance programme and indeed the wider SOE (state-owned enterprises) sector," said Nomura International emerging markets economist Peter Attard Montalto.
"The government needs to remember that there is more at stake here than just Eskom," he added.
Public Enterprises Minister Barbara Hogan, who oversees Eskom, said in a speech to parliament that proper corporate governance procedures had been followed to resolve the dispute and the damage done to Eskom was "minimal".
But analysts said that the political interference by interest groups and perceived lack of a government voice throughout the dispute could make investors hesitate to commit new funds or only do so at a higher rate. [ID:nLA586147]
"This will certainly have an effect on investor confidence and if this issue is not resolved quite soon it may have an effect on Eskom's international credit rating," said Nel Marais, political analyst at Executive Research Associates.
Eskom has already been struggling to raise funds for its 385 billion rand ($52 billion) expansion programme, especially as credit markets are tight in the face of the recession.
Over the past two weeks, Maroga had dismissed reports by Eskom board members who said he had resigned following a clash with Godsell, who stepped down on Monday. [ID:nLB111692]
Maroga's tenure has been marked by power shortages, a record loss of 9.7 billion rand ($1.3 billion) in the year to March and electricity price rises criticised for stoking inflation in a recession. [ID:nLR677617]
Makwana said Maroga would leave under the same conditions as any employee who chose to resign. He said Brian Dames, the head of generation, and Erica Johnson, the head of the customer and network services, would run Eskom's operations in the interim.
For SCENARIOS, double click on [ID:nLC010105]
(Additional reporting by Muchena Zigomo and Alison Raymond in Johannesburg and Wendell Roelf in Cape Town, Writing by Marius Bosch; Editing by Giles Elgood)
