Thomson Reuters, the world’s leading source of intelligent information for businesses and professionals, has released the annual investment banking analysis for Sub-Saharan Africa.
According to estimates from Thomson Reuters / Freeman Consulting, Sub-Saharan African investment banking fees reached $476.4 million in 2015, 24 percent more than the value recorded during the same period of last year. Fees from completed M&A transactions totaled $174.5 million, a 96 percent increase from last year and the highest annual period since 2011.
Sneha Shah, Managing Director Africa at Thomson Reuters, said: “The value of announced M&A transactions with any Sub-Saharan African involvement reached $66.7 billion for 2015, 73 percent more than the value registered during 2014.”
“Sub-Saharan African equity and equity-related issuance totaled $3.9 billion during the fourth quarter of 2015, a 93 percent sequential increase in value from the third quarter of 2015. Sub-Saharan African debt issuance raised a total of $15.5 billion in proceeds for 2015, a 22 percent decline compared to last year, and the lowest annual period since 2012,” she added.
In respect to investment banking fees, fees from debt capital markets underwriting also increased 41 percent year-on-year to reach $63.0 million. Syndicated lending fees fell 21 percent from over a year ago to $108.1 million.
Equity capital markets underwriting fees grew 14 percent to $130.8 million, and accounted for 27 percent of the overall Sub-Saharan African investment banking fee pool.
Rand Merchant Bank earned the most investment banking fees in Sub-Saharan Africa for 2015, a total of $48.5 million for a 10.2 percent share of the total fee pool.
Rand Merchant Bank also topped the completed M&A fee rankings during 2015. Java Capital (Proprietary) Ltd took the lead for ECM underwriting with 14.4 percent share of the ECM fee pool.
Deutsche Bank took first place for DCM underwriting with 13.2 percent share of the total DCM fees. Standard Chartered ranked first place for syndicated loans fees and captured 11.1 percent of the loans fee share.
As for M&A deals, outbound activity increased 13 percent compared to 2014 and reached $6.7 billion in deal value. South Africa’s overseas acquisitions accounted for 74 percent of Sub-Saharan African outbound M&A activity, while acquisitions from Mauritius and Seychelles companies accounted for 19 percent and 4 percent, respectively.
Inbound M&A significantly grew by 283 percent year-on-year to $41.1 billion, the highest annual period in any given year.
Domestic and inter-Sub-Saharan African M&A reached $11.9 billion, down 32 percent from last year.
The Consumer Products & Services industry was the most active sector with $24.0 billion worth of deals, and accounted for 36.0 percent of Sub-Saharan African involvement M&A.
The largest deal with Sub-Saharan African involvement in 2015 was the $22.6 billion reverse takeover transaction of Steinhoff International Holdings NV facilitated by an offer from Genesis International Holdings NV.
Goldman Sachs topped the 2015 announced Any Sub-Saharan African Involvement M&A League Table with $15.9 billion and captured 23.8 percent market share.
In respect to Equity Capital Markets, Sub-Saharan African ECM activity was up by 37 percent year-on-year to reach $9.3 billion in 2015.
This is the highest annual period for the region’s ECM activity since 2007.
Ten initial public offerings raised $544.5 million and accounted for 6 percent of the ECM activity in the region, while follow-on offerings and convertibles accounted for 81 percent and 13 percent market share, respectively.
Naspers Ltd raised $2.5 billion from a follow-on offering in December, the largest equity offering in the region so far this year. Citi took first place in the 2015 Sub-Saharan African ECM ranking with a 21 percent market share.
As for Debt Capital Markets, South Africa was the most active issuer nation with $5.5 billion in bond proceeds which accounted for 35 percent of market activity, followed by Ivory Coast with 28 percent market share worth $4.3 billion in proceeds.
The Republic of Angola offered the largest bond issuance for the region this year with its $1.5 billion sovereign debt in the form of Eurobonds. Deutsche Bank took the top spot in the Sub-Saharan African bond ranking for 2015 with a 19 percent share of the market.
