Middle East M&A activity rises to $37 billion in 2014

Real estate was the most active sector last year and accounted for 38 per cent of the region’s involvement in M&A activities.

By Staff Report

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Published: Wed 21 Jan 2015, 11:51 PM

Last updated: Fri 26 Jun 2015, 12:10 AM

Dubai: The UAE led debt capital markets activity in 2014 among Middle Eastern countries, with a 48 per cent share of the total $37 billion followed by Saudi Arabia that accounted for 30 per cent, according to data issued by Thomson Reuters on Tuesday.

The data also states that the value of announced mergers and acquisitions (M&A) with the involvement of any Middle Eastern country jumped to $37 billion in 2014. Real estate was the most active sector last year and accounted for 38 per cent of the region’s involvement in M&A activities.

“The value of announced M&A transactions with any Middle Eastern involvement reached $22.7 billion during the fourth quarter of 2014, more than double the value registered during the previous quarter, and the highest quarterly total since the first quarter of 2008,” Nadim Najjar, managing director, Middle East and North Africa, Thomson Reuters, said in a statement.

Najjar added: “Middle Eastern equity and equity-related issuance totalled $11.4 billion in 2014, a 173 per cent increase in activity from 2013 ($4.2 billion), while Middle Eastern debt issuance reached $3.5 billion during the fourth quarter of 2014, half the value raised during the third quarter.”

Despite the uptick in the investment banking fees during the last quarter, fees earned during 2014 declined three per cent from $776.2 million during 2013, to $751.7 million.

Equity capital markets underwriting fees totalled $125.1 million in 2014, up 163 per cent from the previous year ($47.5 million), and marking the best annual total for ECM fees in the Middle East since 2009.  ECM fees accounted for 17 per cent of this year’s overall Middle Eastern fee pool.

Fees from completed M&A transactions totalled $159.2 million, down five per cent from 2013 and accounting for 21 per cent of the fee pool.

Fees from debt capital markets underwriting declined 27 per cent year-on-year to $86.8 million, while syndicated lending fees fell 21 per cent to $233.4 million.

HSBC earned the most investment banking fees in the Middle East during 2014, a total of $56.9 million for a 7.6 per cent share of the total fee pool. Lazard topped the Middle Eastern completed M&A fee league table, while HSBC was first in the ECM and DCM underwriting fee rankings. Mizuho Financial Group took the top spot in the Middle Eastern loans fee ranking.

The largest deal with Middle Eastern involvement in 2014 was the $9.1 billion offer for Songbird Estates, the owner of London’s Canary Wharf financial district, by the Qatar Investment Authority and Canada’s Brookfield Property Partners.

— abdulbasit@khaleejtimes.com



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