Relationships with family-run businesses matter more to bankers in Asia than anywhere else. FinanceAsia has analysed which tycoons turn to which banks when they want to get a deal done.
The list of top investment bankers for 35 of Asia’s tycoons was generated in collaboration with data provider Dealogic. Inclusion is based on FinanceAsia’s ranking of Asia’s 75 richest business families in Asia ex-Japan, based on dividends from listed entities; the list was published last September, and updated for this project to accommodate newcomers such as Alibaba and Dalian Wanda.
Dealogic tallied fees paid for investment banking advice by the companies since 2000, and the top deals done across equity and debt capital markets, M&A and syndicated loans for that period. The list included tycoons in Asia but excluded Japan and Taiwan. The data does not capture fees earned from privately executed deals. Today, we look at the top investment bank relationships ranked 21 to 35.
At the 21st place is Hong Kong tycoon Lee Shau-Kee of Henderson Land Development, whose top investment banker is Morgan Stanley. The US bank has netted $30 million in revenues since 2000. The US firm was a bookrunner on Henderson Land's $708 million follow-on in 2006 and also advised Henderson Land on its acquisition of Henderson Investment's stake in Hong Kong and China Gas in 2007. HSBC was ranked second, earning $17 million and was a bookrunner for Towngas China's $122 million follow on, alongside UBS in 2013.
The US firm was also the top banker to Chinese tycoon Xu Rongmao (known in Cantonese as Hui Wing-Mau), who controls Chinese property developer Shimao, and Mukesh Ambani who controls Reliance Industries, pocketing $24 million and $21 million respectively.
UBS emerged as the top banker to Philippines tycoon Andrew Tan, who controls Alliance Global, earning $25 million in fees. Meanwhile, Macquarie is the top investment banker to Henry Sy's SM Invesments and BDO, earning $21 million in fees.
Out of Indonesia, Standard Chartered is the top banker to the Riady family's Lippo group, earning $21 million, followed by Credit Suisse, which has earned $14 million, according to Dealogic.
|The top investment bank by tycoon|
|Tycoon||The families' flagship companies||Top investment bank by fees earned||Net revenue since 2000* ($m)|
|21||Lee Shau Kee||Henderson Land Development||Morgan Stanley||30|
|22||Wee Cho Yaw||UOB, Haw Par, UOL, UIC||UOB||27|
|23||Lim Kok Thay||Genting||DBS||26|
|24||Andrew Tan||Alliance Global||UBS||25|
|25||Hui Wing Mau||Shimao||Morgan Stanley||24|
|26||Robert Kuok||Kuok group||JP Morgan||22|
|27||Mukesh Ambani||Reliance Industries||Morgan Stanley||21|
|28||Riady family||Lippo group||Standard Chartered||21|
|29||Henry Sy||SM Investments, BDO||Macquarie||21|
|30||Hui Ka Yan||Evergrande Real Estate||Bank of America Merrill Lynch||20|
|31||Martua Sitorus||Wilmar International||CIMB||19|
|32||Quek Leng Chan||Hong Leong Finance||Hong Leong Finance||17|
|33||Anthoni Salim||First Pacific & Salim group||Maybank||17|
|34||Ng brothers||Far East Organisation||JP Morgan||17|
|35||Yeoh Tiong Lay||YTL Corp||Maybank||16|
There are myriad reasons why a bank gets appointed for a deal but increasingly, banks in Asia have been leveraging off their private banking arms to generate investment banking deal flow. In the post-global financial crisis world, banks are required to do more with less.
Asia remains dominated by family-held companies. According to an Ernst & Young report, 85% of companies in Asia Pacific are family-owned and they account for about 34% of nominal GDP in Asia. In addition, a higher proportion of private wealth clients play an active role in running companies and making day-to-day decisions.
“The key difference between Europe and Asia is that 70% of our private wealth clients in Asia are entrepreneurs and most of the wealth is still first- and second-generation,” Bryan Crawford, head of institutional solutions group for Asia at UBS, told FinanceAsia. “Typically that means they are keen to see corporate finance opportunities, both investment and financing related, and are comfortable with a reasonably high level of risk.”
In Europe, on the other hand, many private wealth clients are fourth or fifth generation, are more risk averse and prefer to have their assets managed rather than to engage in deal-making.