DOHA: The Middle Eastern investment banking fees reached $416.8m during the first half of 2016, an 8 percent increase compared to fees recorded during the first six months of 2015 and the strongest period for investment banking fees in the region since 2014.
According to estimates from Thomson Reuters / Freeman Consulting, the Middle Eastern debt issuance reached $32.9bn during the first six months of 2016, while equity and equity-related issuance totalled $1.1bn during the first half of 2016.
Nadim Najjar, Managing Director, Mena, Thomson Reuters, said: “The value of announced M&A transactions with any Middle Eastern involvement reached $18.7bn during the first half of 2016, a decline of 29 percent compared to the first half of 2015 and the slowest first six months for deal making in the region since 2014.”
“Middle Eastern equity and equity-related issuance totalled $1.1bn during the first half of 2016, an 80 percent decline from the first half of 2015 and the slowest opening six-month period for equity capital markets issuance since 2004. Bolstered by a record-breaking second quarter, Middle Eastern debt issuance reached $32.9bn during the first half of 2016, a 45 percent increase compared to the value raised during the first half of 2015 and the strongest first half for DCM issuance since records began in 1980,” he added.
In respect to investment banking fees, Fees from completed M&A transactions totalled $104m during the first half of 2016, a 24 percent decrease compared to a year ago and the slowest first half for M&A fees since 2012.
Syndicated lending fees accounted for just over 55 percent of the overall Middle Eastern investment banking fee pool, the highest first half share since 2002. Equity capital markets underwriting declined 77 percent compared to last year, while debt capital markets fees totalled $63.7m, up 48 percent from 2015. Fees from combined debt and equity capital markets underwriting accounted for 30 percent of the overall fee pool in the region during the second quarter of 2016, up significantly from the 6 percent recorded during the first quarter of the year.
Powered by M&A and DCM fees, JP Morgan earned the most investment banking fees in the Middle East during the first half of 2016, a total of $20.6m for a 4.9 percent share of the total fee pool.
Rothschild topped the completed M&A fee rankings with 19.7 percent of advisory fees, while HSBC was first for DCM underwriting, up from second place a year ago. ECM underwriting was lead by Emirates NBD PJSC with $4.4m in ECM fees, or 24.4 percent share. Mitsubishi UFJ Financial Group took the top spot in the Middle Eastern syndicated loans fee ranking with $12.8m in fees for 5.6 percent of the market.
As for M&A deals, Outbound M&A activity fell 22 percent from first half 2015 to reach $9.2bn, the lowest first half total since 2014. Overseas acquisitions from Saudi Arabia accounted for 42 percent of Middle Eastern outbound M&A activity, while acquisitions by companies based in Qatar and United Arab Emirates accounted for 31 percent and 11 percent, respectively.
Domestic and inter-Middle Eastern M&A decreased 22 percent year-on-year to $6.1bn. Inbound M&A fell 76 percent to $809.8m, a seven-year low.
Technology was the most active sector, accounting for 22 percent of Middle Eastern involvement M&A. The largest deal with Middle Eastern involvement during the half was the $3.5bn investment in United States-based Uber Technologies by Saudi Arabia’s Public Investment Fund. JP Morgan, which advised Uber Technologies, topped the first half 2016 announced any Middle Eastern involvement M&A league table. Jones Lang LaSalle and CBRE Holding, which advised BlackRock on the $2.5bn sale of its Asia Square Tower to Qatar Investment Authority, ranked second and third respectively.
In respect to Equity Capital Markets, six initial public offerings raised $379.7m and accounted for 35 percent of first half 2016 activity in the region. As for Debt Capital Markets, Qatar was the most active nation in the Middle East accounting for 41 percent of overall activity, followed by United Arab Emirates and Oman.
The Peninsula
