Hong Kong tycoon Li Ka-shing has by far been the most active deal-maker in Asia and generated the most fees for investment banks since 2000. Li Ka-shing controlled companies, including Hutchison Whampoa, Cheung Kong Holdings and Cheung Kong Infrastructure, have generated a total of $1.1 billion of investment banking fees since 2000, according to data provider Dealogic. Given the prolific nature of his deal-making, banks are constantly knocking on his door.
Goldman Sachs is top of Li’s go-to list. The New York bank has been the house banker to Li’s empire and has pocketed a cool $252 million in fees from the group since 2000, more than any of its rivals.
While Goldman Sachs has traditionally been the house banker to Cheung Kong, Hutchison Whampoa and Cheung Kong Infrastructure, of late two banks – Bank of America Merrill Lynch and HSBC – have been stepping up their game and become more prominent.
The two banks have earned $137 million and $104 million respectively in fees since 2000. HSBC advised on the reorganization of Cheung Kong Holdings and Hutchison Whampoa and is a joint sponsor for the spin-off alongside Bank of America Merrill Lynch. While Goldman Sachs also advised on the reorganization, it was added on later, after the deal was announced. HSBC is also advising Hutchison on its O2 acquisition.
Bank of America Merrill Lynch sold its non-US private wealth business to Julius Baer in 2012, hence the bank isn't leveraging off private banking relationships. Nonetheless, the US bank has relationships with the group on the investment banking side. Matthew Koder, the Asia Pacific president of Bank of America Merrill Lynch is married to the daughter of Canning Fok, who is Li Ka-shing’s right hand man and a managing director for Hutchison Whampoa. Meanwhile, HSBC has been stepping up its game, leveraging off its massive loan book to Hong Kong conglomerates to cross-sell its investment banking services.
Although Royal Bank of Canada is not among the top fee earners, the bank has cropped up in recent times. Royal Bank of Canada advised Cheung Kong Infrastructure and Cheung Kong Holdings on the acquisition of Eversholt. RBC also previously advised Cheung Kong Infrastructure on its acquisition of Northumbrian Water and has lent to the group. Li and his family have strong ties to Canada, and both his sons Richard Li and Victor Li have Canadian citizenship, according to a past South China Morning Post report. The family's investments in Canada date back to 1991 when Hutchison Whampoa and Li Ka-shing became Husky Energy's major shareholders.
Li’s oldest son Victor, is closely involved in his father’s business empire and is deputy chairman of flagship companies Hutchison Whampoa and Cheung Kong Holdings as well as chairman of Cheung Kong Infrastructure. His youngest son Richard, meanwhile, has embarked on new investments and founded Pacific Century group, which makes investments in financial services, telecommunications and technology and is the owner of PineBridge Investments. He is also the chairman of PCCW.
In the second place in terms of fees earned by the top investment bank, was India’s Tata group. Companies controlled by the Tata family, including Tata Steel, Tata Motors and Tata Consultancy Services have generated $1 billion of fees for investment banks since 2000. Credit Suisse has emerged as the top banker, raking in $108 million of fees, according to Dealogic.
In the third place was newcomer Alibaba, the Chinese internet company founded by Jack Ma, which generated $571 million of fees for investment banks. Credit Suisse was the top banker to Alibaba, and notably played a lead role on the company’s record-beating IPO last year. The Swiss bank has earned $94 million in fees from Alibaba.
The list of top investment bankers for 40 of Asia’s tycoons [see table below for the top 10 tycoons] was generated in collaboration with data provider Dealogic and was based on FinanceAsia’s rich list published last September and included a few newcomers such as Alibaba and Dalian Wanda. The 2014 rich list included 75 families who represented the top dividend earners by country in Asia excluding Japan.
|The top investment bank by tycoon|
|Tycoon||The families' flagship companies||Top investment bank by fees earned||Net revenue since 2000* ($m)|
|1||Li Ka-shing||Cheung Kong Holding/Hutchison Whampoa||Goldman Sachs||252|
|2||Tata family||Tata group||Credit Suisse||108|
|3||Jack Ma||Alibaba||Credit Suisse||94|
|4||Ananda Krishnan||Maxis & Co||CIMB||88|
|5||Anil Agarwal||Vedanta Resources||JP Morgan||71|
|6||Wang Jianlin||Dalian Wanda||Citi||61|
|7||Lee Seng Wee||OCBC||OCBC||56|
|8||Chey Tae Won||SK||Citi||55|
|9||Cheng Yu-tung||Chow Tai Fook Enterprises /New World||HSBC||53|
|10||Lee Kun-Hee||Samsung||Samsung Securities||50|
Dealogic looked at fees paid for investment banking advice by the companies from 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 private deals.