Under a newly revitalized name, the European investment bank Dresdner Kleinwort Wasserstein is planning to expand its business in Asia. Heads of global equities, Conor Killeen and Martin Korbmacher were in Asia today to discuss their strategy.
They say they will take a fairly focused approach to growing the Asian franchise. They have chosen to focus on three sectors: financial institutions, techology-media-telecoms (TMT) and oil and gas. "This is no coincidence," says Killeen. "If you look at Asia this year, 70% of investment banking fees have come from TMT and another 15% from financial institutions and energy."
Dresdner Kleinwort Wasserstein – presumably destined to be called DKW – has had a mixed year. It suffered tremendously when an potential merger with Deutsche Bank was being discussed and many key staff walked. It has also scored some notable successes in Europe such as lead managing the listing of T-Online, which went to market with a market capitalization of around E30 billion.
Killeen points out that the TMT business is about personalities as much as anything else and thanks to the acquisition of Wasserstein "we have some of the biggest personalities in the business". Korbmacher adds that the firm aims to launch Asian equity offerings in the $50 to $250 million range in the coming year. A key market will be Taiwan where an office has just been opened with 10 professionals. DKW also has a 40-person equities team in India, plus an information technology subsidiary based out of Bangalore.
While Nasdaq has been the favoured route for many Asian issuers thus far, DKW also hopes to explore the potential of the European equivalent, the Neuer Market. The average deal size on the Neuer market has been E100 million and around two deals get done each week. "That means you get a lot of media coverage," says Korbmacher.
He adds that it is quite an issuer-friendly exchange and has had recent listings from the US and Israel, and is especially good for biotech and companies specializing in chip R&D. "If I take a look at what's happening in Taiwan, there are a number of companies working in chip R&D and that might be an area of interest," he says. "However, these companies will need good investor relations to approach European investors."
With a refreshing honesty, Killeen adds: "underlying our approach will be building a profitable business.We are not going for market share for market share's sake."
