The value of announced mergers and acquisition (M&A) transactions with any Mena involvement reached $31.9 billion during the first six months of 2023, down 34% compared to last year and the lowest first half total since 2017, according to Refinitiv, an LSEG (London Stock Exchange Group) business, in a new report.

 

While down 23% from last year’s all-time record first half tally, the number of deals announced in the region during the first six months of 2023 reached the third highest first-half level since our records began in 1980, it stated. 

 

According to Refinitiv, an estimated $475 million worth of investment banking fees were generated in the  region during the first six months of 2023, half the value recorded during the same period in 2022 and the lowest first-half total since 2015. 

 

Advisory fees earned from completed M&A transactions in the region totalled $95.4 million, a 70% decrease from year ago levels and the lowest first-half total in five years.

 

Equity capital markets underwriting fees also recorded a decline, falling 46% year-on-year to $128.1 million, a two-year low. Syndicated lending fees declined 68% to a twelve-year low of $113.7 million, while debt capital markets underwriting fees increased 170% to a two-year high of $137.7 million.

 

Mena fees account for 0.9% of investment banking fees earned globally during the first half of 2023, down from 1.6% during first-half 2022.

 

Thirty-nine percent of all Mena fees were generated in the UAE, followed by Saudi Arabia (37%). JP Morgan earned the most investment banking fees in the region during the first half of 2023, a total of $36.2 million or a 7.6% share of the total fee pool.

 

According to the expert, the deals involving a Mena target totalled $15.1 million during the first six months of 20203, down 43% from last year and a six-year low.

 

Inbound deals involving a non-Mena acquiror declined 13% to $7.6 billion, while domestic deals decreased 58% in value to $7.6 billion.  

 

Mena outbound M&A totalled $16 billion, a first-half total only exceeded once in the last fifteen years. 

 

The Financials sector was most active, with deals targeting industrial companies accounting for 57% of Mena target M&A during the first half of 2023, followed by the Media & Entertainment sector with 11%, stated the report. 

 

The UAE was the most targeted nation, followed by Saudi Arabia and Oman. JP Morgan topped the any MENA involvement announced M&A financial advisor league table during the first half of 2023, it added.

 

Refinitiv in its report said Mena equity and equity-related issuance totalled $5.7 billion during the first six months of 2023, the third highest first half total since our records began.

 

Proceeds raised by companies in the region declined 59% compared to first-half 2022, while the number of issues dropped by 23%. Initial public offerings accounted for 94% of activity, while follow-on issuance accounted for 6%. 

 

A total of 23 initial public offerings were recorded during the first half of 2023, one more than last year at this time and the highest first-half tally since 2008. They raised a combined $5.3 billion.

 

On the Mena debt capital sector, the report said the issuance totalled $45.9 billion during the first six months of 2023, more than double the value recorded during the same period in 2022 and a two-year high. The number of issues declined 16% over the same period. 

 

According to Refinitiv, Saudi Arabia was the most active issuer nation during the first half of 2023 accounting for 60% of total bond proceeds, followed by UAE (22%), and Bahrain (6%). 

 

Government & Agency issuers accounted for 52% of proceeds raised during the first half of 2023, while Financial issuers accounted for 40%. Islamic bonds raised $18.4 billion during the first half of 2023, an increase of 189% from year ago levels and the highest first half total in six years, it stated.

 

Sukuk account for 40% of total bond proceeds raised in the region, compared to 35% last year. Citi took the top spot in the MENA bond bookrunner ranking during the first half of 2023 with $5.9 billion of related proceeds, or a 13% market share. Citi also ranks first in the H1 2023 MENA Islamic bonds league table, it added.-TradeArabia News Service