Middle East investment banking volumes saw a tentative rebound in 2017, after a drop in 2016, suggesting that regional reform is already producing opportunities for deal makers, after the demise of the international sovereign buy-outs of the oil-boom era.
The region’s best investment bank, Citi, is more aware of these opportunities than most and is positioning itself accordingly. It demonstrated a return to form last year, showing rare leadership of both financing and advisory. It increased its share of debt capital market volume and rose up Dealogic’s equity and M&A league tables. It also remains committed to smaller and more difficult markets, as in its leadership of Iraq’s first standalone bond in over a decade, raising $1 billion, and in Jordan’s $1 billion debut 30-year bond.
Citi’s position as global coordinator on Saudi Arabia’s debut sovereign sukuk is another sign of its ability to claw back lost ground in the Kingdom after a long absence. The Saudi capital markets regulator licensed Citigroup Saudi Arabia in April, with the bank appointing Carmen Haddad as country head and Majed Al Hassoun head of Saudi investment banking. Citi named Miguel Azevedo its combined investment banking head for Middle East and Africa (outside South Africa) in November, aligning the investment bank leadership structure with that of the wider bank under Atiq ur Rehman, chief executive for the combined Middle East and Africa regions.
Atiq ur Rehman
While these moves bode well for the future, the bank is already posting exceptional regional results. For example, it was global coordinator on innovative and complex deals such as the $1 billion project bond for Emirates Sembcorp Water and Power in Fujairah and Acwa Power’s $814 million bond, offering rare international access to one of the higher-rated Saudi corporates.
Citi affirmed leadership in the Kuwait market in the debut bond from the sovereign and in National Bank of Kuwait’s debut 144a/RegS bond. It was also global coordinator on what it says is the first corporate sukuk from Kuwait, for Equate Petrochemical Company.
In equity, Citi was joint global coordinator on Adnoc Distribution’s $851 million IPO. It also worked on the IPO of ADES International Holding, in the upstream energy sector, and on Human Soft’s $120 million equity offering in Kuwait, on behalf of the Al Imtiaz Group.
In M&A, it advised on the sale of Zain to Omantel and the sale of Zain’s tower portfolio to IHS, among other Gulf mergers in energy, logistics and engineering. It also advised on the biggest deal of the year, Intel’s $15 billion acquisition of Mobileye, in the Israeli tech sector.