Second Highest Month for US$ Investment Grade Debt
With this week's $4.0 billion offering from Chevron Corp and a $3.5 billion offering from Costco Wholesale Corp, the monthly volume of US$ Investment Grade corporate debt climbed above $120 billion, the second largest month for Investment Grade debt since records began in 1980. The all-time largest month for investment grade debt issuance was May 2008, when over $143.8 billion in new offerings were brought to market. Year-to-date, US$ Investment Grade corporate debt totals $939.4 billion, an increase of 29% compared to last year at this time.
JP Morgan leads the year-to-date ranking for US Investment Grade corporate debt underwriting with 15.1% market share, up from 14.8% last year. Citi and Bank of America Merrill Lynch round out the top three, each with 10.6% market share.
BRIC IPO Activity Falls to Nine-Year Low
The $1.69 billion initial public offering for Moscow-based wireless telecommunications provider, MegaFon, brings the volume of IPOs from BRIC issuers to $21.5 billion, a 60% decline compared to last year at this time and the slowest year-to-date period for BRIC IPOs since 2003. The MegaFon offerings ranks as the second largest BRIC IPO this year, behind Brazil's Banco BTG Pactual SA which raised $1.72 billion in April. Industrials, materials and high technology offerings account for 50% of BRIC IPO volume so far this year, up from 46% of activity last year at this time.
Seven of the top 10 BRIC underwriters are Chinese domestic banks, led by Guosen Securities which controls 13% of the market this year, compared to 6.4% last year. Chinese IPOs account for 80% of this year's BRIC IPO activity, down from 84% last year at this time.
Real Estate M&A On Par with 2011 Levels
An investor group comprised of Equity Residential and AvalonBay Communities Inc agreed to acquire Archstone Enterprise LP, a real estate investment trust, from Lehman Brothers Holdings Inc for$16.3 billion, bringing the volume of worldwide real estate M&A to $195.9 billion, on par with 2011 levels. US real estate targets account for 39% of worldwide activity in the sector, followed by real estate targets in the United Kingdom (10%) and Canada (7.5%).
Gleacher & Co, an advisor to Lehman Brothers Holdings in its January purchase of the remaining 26.5% stake in Archstone and in the final sale to the investor group this week, tops the ranking of financial advisors in the real estate sector this year. Gleacher ranks 26th for worldwide M&A this year, the firm's highest rank since 1997.