ABN – Germany’s KfW Development Bank will loan Transnet R2.8 billion (US$230 million) for South Africa’s biggest ever locomotive acquisition.
The loan will mature in 15 years and will have a five-year grace period in which Transnet will only pay interest.
Transnet will use some of the funds for its $1.2 billion locomotive construction contract with Bombardier (TSX: BBD.A).
Over R300 billion will be invested by Transnet in the expansion of railways, ports and pipelines by 2019.
Locomotives will be ordered from General Electric, Bombardier and two Chinese firms.