Rainmakers rediscovered the spring in their step in 2013, but swagger wasnt an option. After the previous years slump, global mergers and acquisitions rebounded. As of November 30 total M&A deal volume stood at $2.63 trillion, according to Dealogic, an 11.2 percent rise over the first 11 months of 2012. With $1.34 trillion in volume, a 26 percent jump, the U.S. showed the biggest regional improvement. But that bounce didnt pump up fees, whose worldwide total fell 13.2 percent, to $14.9 billion.
The M&A market hinges on CEO confidence, which wavered in 2013 as a blistering first quarter fueled hopes of a bonanza year until the U.S. Federal Reserve Board dashed them in May by suggesting that it would scale back its bond-buying program. When that didnt happen, volumes recovered, with more than $350 billion worth of European deals alone announced in September.
Other deal makers fared better. Global equity issuance hit $748.8 billion through November, a 26 percent spike over the same period in 2012 as the market for initial public offerings rocketed by 30 percent. The U.S. saw transactions such as the $2.1 billion listing of social media phenomenon Twitter (No. 8 in our ranking), and the European IPO market came back from its nadir.
Global debt issuance fell 7.4 percent, to $5.7 trillion, after record volumes in 2012, but the expected slump didnt arrive. The Feds apparent decision to delay tapering until 2014 sparked a surge in issuance during the fourth quarter and put supply within range of the previous year. Europes debt markets also stayed strong, bolstered by low interest rates and relative stability in the euro zone. Recently, Europe has proved a popular destination for foreign global borrowers as the regions credit markets deepened, says Jim Esposito, head of financing for Europe, the Middle East and Africa at Goldman Sachs Group in London. Large multinational corporations are looking to diversify their sources of funds by issuing in euros and sterling.
In Asia, M&A volumes staged a revival, rising 14.8 percent year-over-year as of November 30, to $508 billion. But the regions equity capital markets bankers lagged their U.S. and European peers: Asian equity issuance fell 5 percent, to $142.8 billion. Goldman Sachs again led the global M&A ranking, with JPMorgan Chase & Co. and Morgan Stanley keeping second and third place, respectively. Goldman grabbed the top EMEA spot from Deutsche Bank, which tumbled to seventh, but was denied a regional clean sweep when archrival Morgan Stanley pipped it to No. 1 in Asia.Top 10 Deals of 2013With these extraordinary closed and pending deals,
our ten rainmakers earned their keep in choppy markets.
Institutional Investors 2013 Deals of the Year ranked by total advisory fees, as estimated by investment consulting firm Freeman Consulting Services and Thomson Reuters honors ten bankers who played key roles in a wide range of remarkable pending and closed transactions. Barclays (No. 1) tapped the equity market for £5.8 billion ($9.1 billion) in the biggest capital raising by a British bank since 2009. Telecom giant Verizon Communications $130 billion acquisition of U.K. rival Vodafone Groups U.S. business (No. 3) was the largest tie-up of the past decade. Shuanghui International Holdings sealed the richest-ever Chinese takeover of an American company with its $7 billion purchase of Smithfield Foods (No. 9), and Apples $17 billion bond sale (No. 10) was the biggest in U.S. corporate history before Verizon surpassed it five months later. Deal makers will face a test in 2014 as differing monetary policies play out: The Feds tapering should lead to higher interest rates, but the European Central Bank and the Bank of Japan are both expected to keep them near historic lows. While activity is clearly picking up, I dont believe there will be a broad-based recovery in European M&A for a couple of years, says Colm Donlon, London-based co-head of M&A for EMEA at Morgan Stanley.