May 24, 2019 / 5:28 PM / 5 months ago

UPDATE 1-South Africa's Eskom CEO resigns for health reasons

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JOHANNESBURG, May 24 (Reuters) - The chief executive of South Africa’s struggling power utility Eskom, Phakamani Hadebe, said on Friday he was stepping down for health reasons after leading efforts to stabilise the highly indebted state firm.

Eskom is regularly cited by ratings agencies as one of the main threats to the country’s creditworthiness and economic growth.

“It is no secret that this role comes with unimaginable demands which have unfortunately had a negative impact on my health. In the best interests of Eskom and my family, I have therefore decided to step down,” Hadebe said in a statement.

Hadebe added that he was “humbled and grateful to have contributed towards the stability for an organisation that is critical for our economy.”

He will step down at the end of July this year, the company’s board said. There was no mention of an interim CEO.

The government appointed Hadebe as chief executive in May 2018, ending a string of interim appointments that stretched back to 2016.

Eskom board chairman Jabu Mabuza said Hadebe should be commended for his “dedication and passion”.

Eskom faces generation capacity constraints and South Africa has been plagued by power cuts in the past year, undermining broader efforts to kick-start growth.

The economy grew an estimated 0.8 percent in 2018 after recovering from recession. Growth is forecast at 1.5 percent this year, and one factor in hitting that target will be how the government manages Eskom’s restructuring.

Battling to preserve Pretoria’s last investment-grade credit rating, President Cyril Ramaphosa has pledged to restructure Eskom with a 23 billion rand ($1.60 billion) a year bailout over the next three years.

$1 = 14.4193 rand Reporting by Olivia Kumwenda-Mtambo, editing by Louise Heavens

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