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Abu Dhabi / Emirates Business
The value of announced M&A transactions in the Middle East and North Africa (Mena) reached an all-time high of $112 billion in the first half of 2019, according to a report from financial data provider Refinitiv. The increase of 231 percent compared to the value recorded during 2018, was driven by Saudi Aramco’s $69.1 billion acquisition of petrochemical producer Sabic, the report said.
The Middle Eastern and North African target and Inter-Mena/Domestic transactions rose to a record $101.2 billion and $86.1 billion, up 375 percent and 699 percent from 2018, respectively.
Mena inbound M&A also stands at a record high of $15.1 billion, while outbound M&A decreased from $6.5 billion in 2018 to $4.6 billion so far during 2019, the lowest volume since 2004. Energy & Power deals currently account for 80 percent of Mena M&A by value, followed by the financial sector with a 13.7 percent market share but counting with 44 transactions, 18 more than the 26 recorded in the Energy & Power industry.
As to Equity Capital Markets, Middle Eastern and North African equity and equity-related issuance totalled $1.1 billion so far during 2019, a 73 percent decrease year-on-year to the lowest level since 2004. With $923.2 million, IPOs represent 88 percent of the region’s ECM issuance, up from 16 percent during last year. Arabian Centres Co Ltd IPO raised $658.6 million and stands out as the biggest deal so far this year.
Despite showing a 12 percent decreased compared to 2018, debt issuance in the Middle Eastern and North African region currently stands at the third highest level since the records began, reaching $53.1 billion so far this year. Saudi Arabia was the most active nation in the region accounting for 40.5 percent of activity by value.
Middle Eastern & North African investment banking fees totalled an estimated $504.8 million so far during 2019, 12.7 percent less than the value of fees recorded during the first half of 2018. Debt capital markets underwriting fees totalled $147.6 million, up 1.7 percent year-on-year, the second highest fee volume for the region since our records began in 2000.
Equity capital markets fees decreased 64.8 percent to $24 million, a 10-year low. Fees generated from completed M&A transactions totalled $207.4 million, a 232 percent increase from last year to the second highest level on record. Syndicated loan fees reached $125.8 million, down 58.4 percent from 2018. Debt capital markets fees accounted for 29.2 percent of the overall Middle Eastern & North African investment banking fee pool, the second highest market share since 2001. Syndicated lending fees accounted for 24.9 percent while the share of completed M&A advisory fees raised to the highest level on record, accounting for 41.1 percent of the market.