Middle East Investment Banking Fees Up 20% In 2013

Investment banking fees in the Middle East grew 20 per cent last year, data compiled by Thomson Reuters showed, as capital markets activity continued to recover gradually from the global financial crisis.

Total fees rose to $722 million in 2013, the highest since 2010, from $603 million in 2012 – though they were still only about half of their 2007 record high of over $1.4 billion.

Fees from completed mergers and acquisitions (M&A) climbed 22 per cent to $213 million, as the value of announced M&A deals with any Middle Eastern involvement rose seven per cent to $43.4 billion.

M&A flows into the Middle East edged down three per cent to $6.1 billion. Egypt was the most popular target for foreign acquirers, accounting for over two-thirds of M&A inflows, while China provided over half of flows into the region.

Outbound M&A from the Middle East – defined as the Gulf, Levant countries and Egypt, but not including other North African states – increased 11 per cent to $14.8 billion.

The data showed that despite last year’s sharp rise of share prices in the Gulf, stock market activity has not come close to recovering from the crisis: Middle Eastern companies raised just $4.2 billion in 2013, down 39 per cent from 2012, because of an 80 per cent drop in follow-on share offers.

Debt issuance in the region throughout 2013 totalled $38.6 billion, little changed from the 2012 level of $38.8 billion.