ZURICH, Dec 11 (Reuters) - ABB has agreed to pay $104 million to South African power utility Eskom to settle an investigation into improper payments and compliance issues, the Swiss engineering company said on Friday.
ABB was investigated by South Africa’s Special Investigation Unit in relation to over-payments for construction work it carried out for Eskom at the Kusile coal-fired power plant.
The project has been marred by massive cost overruns and delays, with claims of corruption and over-payments to contractors.
ABB said the majority of the payment had already been recognised in its financial results over the last 15 months. There would be an additional impact of $30 million on its operational earnings before interest, tax and amortisation during the fourth quarter, while cash flow would be reduced by $110 million.
The industrial robots and drives maker, which self-reported the problems to the U.S. and South African authorities last year, said on Friday it would continue to cooperate with investigators, as well as well as authorities in the United States, Germany and Switzerland.
“ABB intends to expeditiously close all related pending proceedings globally, the impact of which is currently not estimable,” the company said. (Reporting by John Revill; editing by Thomas Seythal and Carmel Crimmins)
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