Africa investment banking fees double in Q1 2011

Sub-Saharan Africa investment banking fees doubled in the first quarter of 2011 from a year ago, with equity market operations posting their strongest first quarter performance since a 2007 regional boom. Investment banks operating in Africa’s fast-growing frontier markets netted $157 million in the three months to the end of March, compared with $68 million previously, according to Thomson Reuters research.

Sub-Saharan Africa investment banking fees doubled in the first quarter of 2011 from a year ago, with equity market operations posting their strongest first quarter performance since a 2007 regional boom.

Investment banks operating in Africa’s fast-growing frontier markets netted $157 million in the three months to the end of March, compared with $68 million previously, according to Thomson Reuters research.

Mergers and acquisitions revenue accounted for half that total -- slightly lower than 54 percent in 2010.
Equity capital markets activity generated $29 million, the strongest first quarter for the sector in four years.

There were no company flotations in the region in the first quarter, with issuance of convertible bonds accounting for 70 percent of the $1.9 billion of equity market activity.
Targeted M&A deals totalled $5.7 billion, a sharp decline on $20 billion a year ago. The energy and power sector was the most popular, attracting $3 billion of deals, the research showed.

Uganda was the most attractive destination, with $2.9 billion of deals stemming from British oil-explorer Tullow Oil selling stakes in its Ugandan operations to France’s Total and China’s CNOOC.

That deal also helped lift China to top spot in the most acquisitive country stakes -- with 26 percent of all activity -- followed by South Africa.

South Africa and London-based bank Investec took the honours as the region’s overall highest earner, with $26.3 million in fees, fractionally ahead of Deutsche Bank with $25.3 million.

Agencies