Goldman gets shot in the ARM

IFR 2144 30 July to 5 August 2016
6 min read
EMEA
Christopher Spink

The referendum on the UK’s membership of the European Union has put off many investors into the country so far this year. The total value of M&A directed at UK targets has fallen 53% in the year to July 21 – to US$95bn compared with the same period a year ago, according to Thomson Reuters data.

However, the agreed £24.15bn (US$31.88bn) offer for UK chipmaker ARM Holdings by Japanese investor SoftBank on July 18 may have heralded a turn in fortunes, with overseas bidders tempted by the fall in sterling.

This was the third biggest announced deal globally this year. However, it has done little to change the table of investment banking fees. The only bulge bracket firm involved was Goldman Sachs, which advised ARM alongside Lazard.

That enabled Goldman to retain its position as the leading earner of M&A fees. It had garnered US$1.42bn from 156 transactions up to July 28, according to Thomson Reuters data. That gave it a 10.5% market share for M&A, significantly ahead of nearest rival JP Morgan, which has earned US$1.08bn from 155 deals, for a market share of 8%.

JP Morgan may not have been on the ARM deal but the steady trickle of other work allowed it to remain above Goldman when all fees were considered – from bond, equity and loan issuance as well. It has now made US$3.02bn from 2,290 deals with a 7% share of the market.

SoftBank was advised by two boutiques on the ARM offer, Robey Warshaw and TMT specialist Raine. Mizuho was also involved, primarily to arrange the ¥1trn (US$9.5bn) two-year bridge loan for the planned purchase.

Mizuho remained in second place in the Asia-Pacific and Japan fees table, with US$444.6m of fees, behind Morgan Stanley. It has built a significant lead ahead of third-placed Citic.

While overall announced M&A, at US$1.82trn is down 22% compared with the same period a year ago, TMT announced deals are only 5% below last year’s equivalent levels, at US$272.6bn.

Global Investment Banking Fees: July 2016
Global Investment Banking Fees
Managing bank or groupNo of issuesTotal US$(m)Share (%)
1JP Morgan2,2903,023.67.0
2Goldman Sachs1,3202,814.16.5
3BAML2,4002,593.36.0
4Morgan Stanley1,8012,335.45.4
5Citigroup2,0292,098.14.8
6Barclays1,5891,606.13.7
7Credit Suisse9991,528.53.5
8Deutsche Bank1,4201,440.83.3
9Wells Fargo & Co1,7981,080.62.5
10RBC CM1,232884.42.0
11UBS707859.62.0
12HSBC1,683791.61.8
13Mizuho Financial1,726748.31.7
14BNP Paribas1,065736.51.7
15Sumitomo Mitsui1,341534.11.2
16Lazard138521.31.2
17Rothschild & Co178500.91.2
18Mitsubishi UFJ1,281464.01.1
19Jefferies LLC458455.21.0
20Nomura957448.11.0
Total​29,49643,500.6
Americas Investment Banking: July 2016
Americas Investment Banking
Managing bank or groupNo of issuesTotal US$(m)Share (%)
1JP Morgan1,6152,214.49.5
2BAML1,8301,996.98.6
3Goldman Sachs7711,995.58.6
4Citigroup1,3061,451.06.2
5Morgan Stanley9781,326.65.7
6Credit Suisse5791,094.64.7
7Barclays9601,053.14.5
8Wells Fargo & Co1,6981,012.74.4
9Deutsche Bank778857.73.7
10RBC CM1,054791.73.4
Total​12,32123,225.0
Asia-Pacific & Japan Investment Banking: July 2016
Asia-Pacific & Japan Investment Banking
Managing bank or groupNo of issuesTotal US$(m)Share (%)
1Morgan Stanley599470.34.9
2Mizuho Financial1,147444.64.6
3Citic893300.23.1
4Sumitomo Mitsui978298.23.1
5Nomura560284.02.9
6Goldman Sachs250261.92.7
7Citigroup318251.52.6
8Bank of China984239.42.5
9Credit Suisse173235.42.4
10ICBC1,016230.32.4
Total​11,2919,636.5
EMEA Investment Banking: July 2016
EMEA Investment Banking
Managing bank or groupNo of issuesTotal US$(m)Share (%)
1JP Morgan501642.76.0
2Goldman Sachs303556.75.2
3Morgan Stanley228538.55.1
4Barclays462493.44.6
5BNP Paribas562462.94.4
6Deutsche Bank451428.94.0
7BAML324416.63.9
8Citigroup407395.63.7
9HSBC598376.83.5
10Rothschild & Co123327.73.1
Total​6,14410,639.1
Global Bonds: July 2016
Global Bonds
Managing bank or groupNo of issuesTotal US$(m)Share (%)
1JP Morgan1,262917.16.8
2BAML1,372898.06.6
3Citigroup1,295843.46.2
4Goldman Sachs816679.95.0
5Barclays1,053642.94.8
6Morgan Stanley1,325640.84.7
7Deutsche Bank943606.64.5
8Wells Fargo & Co1,094523.53.9
9HSBC1,192452.43.3
10Credit Suisse582436.63.2
Total​17,09413,512.2
Global Equities: July 2016
Global Equities
Managing bank or groupNo of issuesTotal US$(m)Share (%)
1JP Morgan188542.36.6
2Morgan Stanley181476.05.8
3Goldman Sachs152438.15.4
4BAML142404.34.9
5Citigroup136314.93.9
6Credit Suisse132297.43.6
7Deutsche Bank109225.92.8
8UBS95209.32.6
9Citic45191.32.3
10RBC CM148185.22.3
Total​2,7948,170.1
Global Loans: July 2016
Global Loans
Managing bank or groupNo of issuesTotal US$(m)Share (%)
1BAML771614.27.4
2JP Morgan685487.15.9
3Citigroup495430.05.2
4Barclays357376.84.5
5Wells Fargo & Co591310.03.7
6Deutsche Bank294300.93.6
7Credit Suisse189300.13.6
8Mizuho Financial640282.83.4
9Mitsubishi UFJ824280.93.4
10Goldman Sachs196280.23.4
Total​5,1078,284.4
Goldman Sachs sign