Refinitiv Releases Sub-Saharan Africa Investment Banking Review for Q1 2019

  • Refinitiv releases Sub-Saharan Africa Investment Banking Review for Q1 2019

Refinitiv, one of the world’s largest providers of financial markets data and infrastructure, today announced that Sub-Saharan African investment banking fees reached an estimated US$93.5 million during the first quarter of 2019, 24% less than the value recorded during the same period in 2018 and the lowest first quarter total in 5 years.

Citi earned the most investment banking fees in Sub-Saharan Africa during the first quarter of 2019, a total of US$16.5 million or a 17.6% share of the total fee pool. Citi also topped the Any Sub-Saharan African Involvement Announced M&A Financial Advisor League Table with a 71% share of the market.

Deals involving a Sub-Saharan African target increased 71% in value to US$6.0 billion, driven by Naspers’ US$5.1 billion spin-off of its pay-TV unit MultiChoice.

South Africa’s overseas acquisitions accounted for 57% of Sub-Saharan African outbound M&A activity, while acquisitions by companies headquartered in Mauritius accounted for 43%.

Standard Bank Group topped the Sub-Saharan African Equity Capital Markets league table during the first quarter of 2019 with a 49% share of the market.

JP Morgan took the top spot in the Sub-Saharan African bond ranking during the first quarter of 2019 with US$944.4 million of related proceeds, or a 16% market share.

Summary of the findings:

INVESTMENT BANKING FEES 

Sub-Saharan African investment banking fees reached an estimated US$93.5 million during the first quarter of 2019, 24% less than the value recorded during the same period in 2018 and the lowest first quarter total in 5 years.  Fees from completed M&A transactions totalled US$36.9 million, a 31% increase year-on-year.  Equity capital markets underwriting reached US$11.6 million, down 70% from the first quarter of 2018 to a 2-year low, while fees from debt capital markets underwriting fell 53% to a 3-year low of US$14.0 million. Syndicated lending fees increased 20% year-on-year to US$30.1 million.  Completed M&A fees accounted for 39% of the overall Sub-Saharan African investment banking fee pool during the first quarter of 2019. Equity and Debt capital markets generated 12% and 15%, respectively, while syndicated lending fees accounted for 33%. Citi earned the most investment banking fees in Sub-Saharan Africa during the first quarter of 2019, a total of US$16.5 million or a 17.6% share of the total fee pool.

MERGERS & ACQUISITIONS

The value of announced M&A transactions with any Sub-Saharan African involvement reached US$8.8 billion during the first quarter of 2019, up 41% from the same period last year.  Deals involving a Sub-Saharan African target increased 71% in value to US$6.0 billion, driven by Naspers’ US$5.1 billion spin off of its pay-TV unit MultiChoice.  Inbound M&A, involving an acquirer from outside of the region, was down 81% year-on-year to a 16-year low of US$540.1 million, while outbound M&A increased 24% to an 8-year high of US$2.2 billion. South Africa’s overseas acquisitions accounted for 57% of Sub-Saharan African outbound M&A activity, while acquisitions by companies headquartered in Mauritius accounted for 43%.  Citi topped the Any Sub-Saharan African Involvement Announced M&A Financial Advisor League Table during the first quarter of 2019 with a 71% share of the market.

EQUITY CAPITAL MARKETS

Sub-Saharan African equity and equity-related issuance totalled US$1.1 billion during the first quarter of 2019, 61% less than the value recorded during the first three months of 2018.  Eight follow-on offerings totalled US$1.0 billion and accounted for 98% of total ECM activity in the region by value, while a single IPO accounted for the remaining 2%.  Icon Properties was the only initial public offering in the region during the first quarter of 2019, raising US$20.4 million on the Malawi Stock Exchange in January. Standard Bank Group topped the Sub-Saharan African ECM league table during the first quarter of 2019 with a 49% share of the market.

DEBT CAPITAL MARKETS

Sub-Saharan African debt issuance totalled US$5.9 billion during the first quarter of 2019, down 52% from the value recorded during the same period in 2018 and the lowest first quarter total since 2016.  Ghana and The Ivory Coast were the most active issuer nations with US$3.0 billion and US$1.2 billion in bond proceeds, respectively.  Ghana raised US$3.0 billion with its Eurobond issue in March, the largest bond offering in the region so far during 2019. JP Morgan took the top spot in the Sub-Saharan African bond ranking during the first quarter of 2019 with US$944.4 million of related proceeds, or a 16% market share.

About the Author

Samed Olukoya
CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade long experience in the global financial market. Contact Samed on Twitter: @sameolukoya; Email: [email protected]

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