“Investment grade corporate debt totalled US$20.8 billion and accounted for 80% of Middle Eastern DCM activity. International Islamic debt issuance reached US$16.4 billion from 44 issues during the first six months of 2013, an increase of 6% from the same period in 2012. The most active nation for International Islamic debt issuance was Saudi Arabia with 37%, followed by Malaysia with 32%. HSBC took the top spot in the Middle Eastern bond ranking so far this year with a 16% share of the market,” Russell Haworth, managing director, Middle East & North Africa at Thomson Reuters, said.
“The value of announced M&A transactions with Middle Eastern targets reached US$14.7 billion during the first half of 2013, 30% more than the US$11.3 billion witnessed in the region during the same period last year, and marking the best first half since 2008, “ he added.
“Bolstered by the US$7.5 billion merger of 2 UAE state-owned aluminium producers, Materials was the most targeted industry during the first half, accounting for 64% of activity,” he said.
Thomson Reuters released its investment banking analysis for the Middle East region for the first half of 2013.
During the first half of 2013, Middle Eastern investment banking fees reached US$356.6 million while equity issuance by Middle Eastern companies raised US$3.2 billion from 12 issues. According to the report, Middle Eastern debt issuance reached US$26.0 billion during the first half of 2013, a 40% increase over the same period last year.
“The UAE was the most active Middle Eastern country, being both the most targeted and the most acquisitive country in the region so far this year. India was the most popular target for outbound Middle Eastern M&A transactions, while the United States registered the highest value of inbound M&A deals targeting the Middle East. As sole advisor on the aluminium merger, Morgan Stanley topped the 1H’13 announced any Middle Eastern involvement M&A ranking with US$9.8 billion,” he added.
In respect to Middle Eastern investment banking fees, Haworth pointed out that these fees reached US$356.6 million during the first half of 2013, a 28% increase over the same period last year (US$277.5 million), and the best first half for fees in the region since 2010. Completed M&A fees totaled $83.6 million, up 56% from the first six months of 2012 (US$53.5 million), and accounting for 23% of the overall fee pool.
Fees from debt capital markets underwriting in the region hit US$102.2 million, up 125% from US$45.4 million during the same period last year, and marking the best first half for DCM fees in the Middle East of all time. Equity capital markets underwriting fees totaled US$43.1 million, down 35% from the same period last year (US$66.7 million), while fees from syndicated lending reached US$127.6 million, up 14% over 2012 and accounting for 36% of the first half fee total.
Deutsche Bank earned the most investment banking fees in the Middle East during the first six months of 2013, a total of US$27.4 million for a 7.7% share of the total fee pool. JP Morgan topped both the Middle Eastern completed M&A and the equity capital markets fee league tables. Deutsche Bank took first place in the Middle Eastern DCM fee ranking with a 14% cut, while Mitsubishi UFJ Financial Group topped the syndicated lending fee ranking during the first half.
Haworth said that Equity issuance by Middle Eastern companies raised US$3.2 billion from 12 issues during the first half of 2013, a 15% decline from the same period in 2012 (US$3.7 billion), and marking the slowest first half since 2010. Initial public offerings, worth a combined total of US$2.0 billion, accounted for 63% of ECM activity in the region. Three follow-on offerings totalling US$702 million accounted for 22%, while convertible issuance accounted for the remaining 15%.
The largest Middle Eastern ECM transaction so far during 2013 was Asiacell Telecommunication’s IPO in February, which raised US$1.3 billion. Bolstered by this deal, Iraq was the most active nation and telecoms was the most active sector in the Middle East during the first half of 2013. As sole bookrunner on the Asiacell IPO, Rabee Securities currently leads the 1H 2013 Middle Eastern ECM ranking with 40% of the market.