The following banks and their clients will be honoured at an awards dinner at the Grand Hyatt hotel in Hong Kong on February 5. If you would like to book a table at the event, please contact Amber Gordon at [email protected].
BEST FIG HOUSE
Goldman Sachs
Goldman Sachs has had an outstanding year in equity in the FIG space with six multi-billion dollar deals, including the two sell-downs in AIA by former parent company AIG, where it was one of only two banks actively taking orders. It also helped China Pacific Insurance (CPIC) raise $1.3 billion of fresh capital through a private H-share placement to three sovereign wealth funds and worked on the $9 billion private placement of A- and H-shares for Bank of Communications.
But it also helped clients reduce their exposure to financial sector companies across the region through a number of comparatively smaller block trades in companies such as ICICI Bank, Yes Bank, Axis Bank, Bank of China, CPIC and Shin Kong Financial. The latter won our award for Best Deal in Taiwan for a well-structured process that allowed Japan’s Dai-ichi to exit a highly illiquid stock with limited impact on the price.
Goldman was also busy on the M&A side, not least with its sell-side mandates for ING, which is in the process of divesting its Asian insurance businesses. To optimise the value, the assets have been broken up into four pieces. The Hong Kong, Macau and Thailand units were sold to Pacific Century Group for $2.1 billion in what ranks as the largest insurance M&A deal in Hong Kong. ING has also reached an agreement to sell its Malaysian business to AIA for $1.7 billion, although that is still awaiting regulatory approval.
Goldman also advised AMG Insurance on its acquisition of Kurnia Insurans in Malaysia and OSK on the sale of its investment bank to RHB Capital.
On the debt side it focused primarily on highly structured and subordinated transactions, completing deals for Temasek, DBS, New China Life, China Citic Bank and ADB, while outside the financial markets it continued to offer risk management solutions and non-traditional funding options to financial institutions. This business has grown rapidly in the past three years and now accounts for 12% to 13% of revenues.
Goldman’s recognised expertise in FIG is also exemplified by its role as an adviser to China’s securities and insurance regulators.
Just before we wrapped up our awards, Goldman acted as a joint global coordinator and sponsor for PICC’s $3.1 billion Hong Kong IPO. But with 17 bookrunners in the syndicate and a messy process throughout, this was not a franchise-defining deal and definitely not a key component of our decision — even if the US bank, once again, did clinch one of the leading roles.
BEST GIG HOUSE
Citi
Citi continues its impressive recovery, and nowhere more so than among the general industries client base. Though activity was down in M&A and equity — with Hong Kong IPO volumes at less than a quarter of 2011 levels — the shift in activity to debt capital markets clearly benefited lenders such as Citi. Indeed, the bank helped its industrial clients to raise more money in the bond markets than in the equity markets during 2012, including a $3 billion deal for Sinopec that was China’s biggest ever dollar bond from a corporate borrower.
It was also involved on the year’s stand-out M&A deal, advising Cnooc on its $15.1 billion acquisition of Nexen. That deal is still awaiting final approvals so wasn’t under consideration for the deal awards, but it is hard to ignore when stacking the banks up against each other for the house awards. It is the biggest overseas acquisition ever by a Chinese buyer and clearly faced a gnarly political backdrop as Canadians fret about selling their resources to the Chinese.
Citi was also on our best M&A deal, advising Heineken on its S$5.6 billion ($4.6 billion) acquisition of Asia Pacific Breweries from Fraser and Neave, and also advised Yanzhou Coal on its $2.2 billion reverse takeover of Gloucester Coal in Australia — a deal that originated from Citi’s relationship with Noble. And, although its clients ended up losing, Citi was at least at the table for the attempted hostile takeover of China Gas in Hong Kong.
Equity was far less important during 2012, but Citi nevertheless had a decent year despite missing the big Malaysia IPOs. More important was its presence across the entire investment banking product range. Rivals don’t like to admit it, but Citi has established itself as a strong competitor in Asia.
BEST TMT HOUSE
Credit Suisse
A key reason Credit Suisse deserves to win this award for 2012 was its role on all five of the transactions that Alibaba Group undertook this year. From its buyback of half of Yahoo’s 40% stake in the Chinese internet company to its taking B2B unit Alibaba.com private through a $2.5 billion general offering to minority shareholders to its three financing transactions, Credit Suisse’s TMT team was there for Alibaba. Each deal was significant in the sector: with the privatisation the largest ever for a Chinese internet company and the financing the largest-ever private financing not just for an internet company but for a private-sector Chinese company as well.
It’s not surprising that the bank was on all of the transactions, as the TMT franchise has a sticky relationship with a host of key companies — doing repeat business not only for Alibaba, but also Hynix, Lenovo, Tencent, Maxis and SK Telecom, to name just a few of the blue-chip companies across technology, media and telecommunications that Credit Suisse banks.
The Alibaba transactions alone would have tipped the balance in Credit Suisse’s favour when it comes to share of wallet for TMT business in Asia in 2012. But in addition, the team was also on a host of other chunky deals: from media entertainment group Astro Malaysia’s $1.5 billion IPO (which was the largest-ever media IPO in Asia) to Hynix’s $3 billion sale of a 21% stake to SK Telecom (which was the largest M&A sale of a Korean technology company since 1999) to the $745 million Maxis block trade, Credit Suisse was in the mix.
Its franchise has traditionally been technology strong, but this year the bank ticked the boxes across all three categories, as well as across geographies, with transactions in nine countries in Asia.
BEST REAL ESTATE HOUSE
J.P. Morgan
A wave of Hong Kong and Chinese property companies raising funds in the bond markets has kept bankers busy this year and that has played into the hands of HSBC, which has leveraged its strength in DCM to completely dominate this business. The Hong Kong-based bank was also involved in three Reit IPOs in Singapore and Malaysia, making it a strong contender for this award.
But when we look across the asset classes, we feel that J.P. Morgan has had a more balanced year. It led its fair share of bond issues and claimed a top-three spot in the league tables behind two lending banks, but it also helped its clients to raise equity capital, mainly through follow-on issues, and advised on a couple of sizeable M&A transactions. The most noteworthy was Yuexiu Reit’s $1.4 billion acquisition of Guangzhou International Finance Centre from its parent company — a transformational deal for the Hong Kong-listed Reit as it more than tripled its portfolio value. J.P. Morgan also worked on the subsequent $415 million equity placement to fund the acquisition and arranged a parallel $50 million private placement to PICC Asset Management, which was crucial for getting the equity deal across the line.
On the equity side, it also helped Country Garden raise fresh capital through a $400 million share placement — the first sizeable equity issuance by a Chinese developer in more than a year — and arranged follow-ons for Ayala Land in the Philippines and Global Logistics Properties and CapitaMall Trust in Singapore. It was also involved in IGB Reit’s IPO in Malaysia and arranged a $250 million convertible bond for SM Investments.
In DCM it put particular focus on the hybrid space. It was the sole global coordinator on the first-ever rated Singapore dollar-denominated corporate hybrid, for Global Logistics Properties, and worked on a perpetual for Genting Singapore, which raised S$1.8 billion ($1.5 billion) and marked the company’s debut issuance in Sing dollars.
BEST ISLAMIC FINANCE HOUSE
CIMB
We have long predicted that with Malaysia at the forefront of Islamic finance, shariah-compliant (or Islamic finance-compliant) transactions would one day become more mainstream. In other words, they would appeal to investors who wanted to put their money to work in businesses that fit with their moral code, but would also appeal to others who don’t take that into consideration when investing.
Given that this was a year with a significant number of landmark Malaysian initial public offerings it’s not surprising that it was also a year for Islamic finance to become a component. Both IHH Healthcare’s $2 billion IPO and Felda Global Ventures $3.3 billion IPO were shariah-compliant and CIMB was a joint global bookrunner on both. Whether or not that helped bring in more investors is somewhat irrelevant at this point; what matters is CIMB ensured that box was ticked, and that is sure to be a trend to continue in Malaysia.
On the more solely Islamic finance front, CIMB continued to lead the way. It chalked up 26.6% of the total issuance in the Malaysian ringgit sukuk league table, according to Dealogic. And ringgit-denominated sukuk is the leading form of such debt issuance. But it’s not just on volume where CIMB is the clear front-runner, it also continues to lead on the significant transactions. It was the sole principal adviser and sole lead arranger on the M$34.3 billion Islamic medium-term notes programme for Projek Lebuhraya Usahasama, which was the world’s largest sukuk issuance to date. And it arranged Axiata SPV2’s issuance of M$1 billion in sukuk pursuant to its $1.5 billion multi-currency sukuk issuance programme. What makes this stand out is Malaysian investors were only allocated 13%. While the Malaysian investors are assumed to have been Islamic-finance-focused ones, the rest were not, which means the sukuk also was distributed to a new pool of investors for the issuer.
CIMB is the only bank in Malaysia with a dedicated syndicate desk focusing on shariah-compliant projects. It is championing the development of the Islamic capital market outside Malaysia and is not only the best franchise in Asia, but arguably leading the way globally as well.
BEST FINANCIAL LAW FIRM
Linklaters
At the risk of sounding repetitive, our choice for best law firm is Linklaters once again. Although this award has often been a close-run contest in the past, this year’s decision was not a difficult one. Linklaters dominated the league tables during 2012 thanks to roles on many of the year’s biggest and most significant deals.
In equities, 2012 proved the value of a strong presence across the region — for bankers and lawyers alike. As activity shifted from Hong Kong and China to Southeast Asia, Linklaters was able to take advantage, winning roles on the year’s landmark IPOs in Malaysia by Felda and IHH, as well as those of Astro and IGB Reit. It also advised on Hong Kong Exchanges and Clearing’s $500 million CB and AIG’s $2 billion sell-down in AIA.
According to Bloomberg’s league tables, Linklaters has raked in around 16% of the fee pool for equity capital markets deals this year and tops the tables whichever you way you dice them, though Clifford Chance runs a close second.
In debt, Linklaters was even more dominant, thanks to its roles on sovereign deals from the Philippines and Indonesia, as well as a host of FIG deals for the likes of State Bank of India, DBS, OCBC, Maybank and Siam Commercial Bank. Nobody else was even close, though David Polk’s second place in the DCM table is certainly an impressive achievement.
Linklaters has also been a market leader in the offshore renminbi market since its inception.
And, yes, it rounded off the league tables with a leading position in M&A as well, including advising Lone Star on the off-market sale of its 51% stake in Korea Exchange Bank to Hana Financial Group.
