Goldman Sachs’s investment bank division excelled during the awards period thanks to a targeted focus on growth sectors such as healthcare, technology and financial sponsor business. This paid off handsomely on its home turf, where the bank dominated the Americas M&A league tables during the awards period, working on 582 deals with a total value of $1.6 trillion for a 30.72% market share. This is slightly ahead of the same period last year where it took 29.52% market share from 408 deals worth $1.15 trillion together.
This hive of activity saw fee income at the firm exceeding $4 billion for first nine months of the year.
The bank was everywhere in North America, both on mid-sized transactions and mega-deals, as firms took advantage of market conditions to raise capital and do deals. The most eye-catching were the $27.7 billion acquisition of Slack Technologies by Salesforce in July last year, on which Goldman advised Slack, and the bumper $69 billion acquisition of Activision Blizzard by Microsoft, which hit the headlines towards the end of the year and brought M&A banking to the metaverse.
The deal will make Microsoft, which Goldman advised, the world’s third-largest gaming company by revenue, behind Tencent and Sony.
The focus on sponsor business has seen Goldman dominate on financing to private equity sponsors during the awards period. The firm was sell-side adviser on the $34 billion sale of medical equipment supplier Medline to Blackstone Group, Carlyle Group and Hellman & Friedman in June last year. This was one of the largest healthcare leveraged buyouts in history, involving a $15 billion debt raise and included investment from the Singaporean sovereign wealth fund, GIC.
As the firm reflects on its stellar year in investment banking, however, it now faces the prospect of a more muted deal environment as companies hunker down and become more defensive.
It nevertheless seems confident that it is well positioned for more of the same and that it will reap the benefit of a niche focus on growth sectors within the investment bank.
The innovation parts of the global economy in sectors like life sciences and technology platforms won’t stop innovating. Great new companies will continue to form
Jim Esposito
“Markets are grappling with the question of has peak inflation actually peaked?” Jim Esposito, global co-head of the investment banking division, tells Euromoney. “Current headwinds in investment banking should prove a temporary pause in what is a long-term constructive environment for deal making and capital raising.
“The innovation parts of the global economy in sectors like life sciences and technology platforms won’t stop innovating. Great new companies will continue to form.”
