Friday 19 July 2019

Najjar: Investment banking fees totalled over $472.3 million
during Q2

Mena M&A deal value in Q2 hits 8-year high at $34bn

DUBAI, July 10, 2018

The value of announced M&A transactions with any Mena involvement reached $33.9 billion during the second quarter (Q2) of 2018, 74 per cent more than the value recorded during Q2 2017 and an eight-year high, a report said.

Deals with a Mena target reached an all-time high rising to $21.3 billion, up 110 per cent from the same period in 2017 while inter-Mena or domestic deals reached a five-year high, also up 232 per cent from year-on-year, added the 2018 Q2investment banking analysis for the Middle East released by Thomson Reuters, a leading source of intelligent information for businesses and professionals.

Driven by Saudi British Bank acquisition of the entire share of capital of Alawwal Bank for $5 billion, Mena inbound M&A currently stands at an all-time high. In the other hand, outbound M&A decreased from $6.9 billion in Q2 2017 to $6.6 billion so far this year.

Energy & Power deals accounted for 32.8 per cent of Mena involvement M&A by value, followed by the financial sector with a 30.2 per cent market share but counting with 58 transactions, 18 more than the 40 recorded in the Energy & Power industry. Goldman Sachs currently leads the Q2 2018 announced any Mena involvement M&A league table. JP Morgan and Credit Suisse follow in second and third place.

Mena investment banking fees totalled an estimated $472.3 million during Q2 2018, 7 per cent less than the value of fees recorded during Q2 2017.

Nadim Najjar, managing director, Middle East and North Africa, Thomson Reuters, said: “Debt capital markets underwriting fees totalled $140.6 million, down 7 per cent year-on-year and the second highest start of the year the region since our records began in 2000. Equity capital markets fees increased 21 per cent to $56.4 million.”

Fees generated from completed M&A transactions totalled $59.6 million, a 52 per cent decrease from last year and the lowest first half since 2012. Syndicated loan fees reached$215.7 million, up 17 per cent from Q2 2017.

Debt capital markets fees accounted for 30 per cent of the overall Middle Eastern & North African investment banking fee pool, the second highest market share since our records began in 2000. Syndicated lending fees accounted for 46 per cent while the share of completed M&A advisory fees fell to its lowest level, only accounting for 13 per cent of the market. Equity capital markets underwriting fees accounted for 12 per cent.  

Citi earned the most investment banking fees in Mena during Q2 2018, a total of $44.8 million for a 9.5 per cent share of the total fee pool; also leading in the M&A underwriting league table. DNB topped the completed ECM fee rankings with 14.2 per cent of underwriting fees. DCM underwriting was led by Standard Chartered with $24.2 million in ECM fees, or a 17.2 per cent share. JP Morgan took the top spot in the Middle Eastern syndicated loans fee ranking.
As to Equity Capital Markets, Mena equity and equity-related issuance totalled $3 billion during Q2 2018, a 68 per cent increase year-on-year. Out of the 15 transactions announced so far this year, 9 have been follow-on offerings, raising a total of $1.8 billion and accounted for 58.5 per cent of the first half ECM activity in the region.

Orange Egypt follow-on raised $866 million and stands out as the biggest deal so far during 2018.EFG Hermes leads the Mena ECM ranking with a 24.4 per cent market share, followed by JP Morgan and Goldman Sachs in second and third place, respectively.
Debt Capital Markets have seen significant activity during the first half of this year, despite showing a 2 per cent decreased compared to Q2 2017, debt issuance in the Middle Eastern and North African region is at its second highest level since our records began, reaching $59.4 billion so far this year.

Qatar was the most active nation in the region accounting for 28.5 per cent of activity by value, followed by Saudi Arabia with 21.8 per cent. International Islamic debt issuance decreased 44 per cent from Q2 2017 to reach $19.3 billion so far during 2018.

Standard Chartered currently leads in the Middle Eastern and North African bond ranking for Q2 2018 with a 14.9 per cent share of the market, while CIMB Group Holdings took the top spot for Islamic DCM issuance with a 15.5 per cent share. - TradeArabia News Service

Tags: Mena | M&A | Merger & Acquisition | Banking fees | Thompson Reuters |

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