Goldman Jumps to No. 1 Asian Mergers Adviser in 2000 (Update1)
By Kate Linebaugh
Hong Kong, Dec. 11 (Bloomberg) -- Goldman Sachs Group Inc. rocketed to the top of the rankings of advisers on Asian mergers, from ninth place in June, as banks compete for recognition in a record year for corporate unions in the region.
Goldman rose to the top spot after it advised China Mobile (Hong Kong) Ltd. on its $34 billion acquisition of seven wireless telephone networks from its parent in October, according to preliminary data from Thomson Financial Securities Data Co. for the first 11 months of the year.
If it holds the spot till the end of December, it will be the third year Goldman has ranked as Asia's top mergers adviser, dashing the hopes of Morgan Stanley Dean Witter & Co., which has also shot up the ranks since June.
Investment banks closely watch league table rankings, which they often use to pitch their credentials to clients and to evaluate the performance of staff. Fees from mergers advisory are also among the highest in the industry.
Morgan Stanley leapt from 10th rank in the first six months of the year to third after receiving credit for advising Pacific Century CyberWorks Ltd. on its takeover of Cable & Wireless HKT Ltd., for which Thomson gave $35.5 billion in league table credit.
Merrill Lynch & Co. remains in the No. 2 spot.
The main adviser on the CyberWorks purchase, UBS Warburg, ranks fourth, which may rankle managers there as the bank has been credited with being the brains behind one of Asia's biggest corporate takeovers.
What's the Big Deal?
Unlike last year, this year's contest for No. 1 is a close race. The difference between first and third place is just $3.2 billion. That is 1.9 percent of the $164.8 billion of mergers advisory work in Asia excluding Japan and Australia in the first 11 months of the year.
``One deal, if it is large enough, can make a huge difference'' in the rankings, said Jim Mallea, product manager for mergers and acquisitions data at Thomson in New York.
At the half-year mark, Morgan Stanley couldn't provide enough evidence that it advised on the CyberWorks transaction to get credit.
So an unidentified senior CyberWorks executive phoned Mallea to vouch that the U.S. bank advised on the takeover.
``We didn't have any evidence and (Morgan Stanley) knew if they could not give us anything they could not have'' credit, said Florinda Villanueva, in mergers and acquisitions research at Thomson in Manila. ``After that conversation, we finally got confirmation and credited them for the deal,'' Villanueva said.
Mallea wouldn't reveal the identity of the executive.
Goldman has advised on 16 transactions worth $47.8 billion, 30 percent of the business in the first 11 months of the year. Merrill Lynch has advised on 20 transaction worth $45.3 billion, while Morgan Stanley has advised on 27 transactions worth $44.6 billion.
Of the top 10 advisers in Asia this year, eight have been credited for advising on the CyberWorks transaction. Only Goldman and China International Capital Corp. didn't.
Goldman Sachs shares rose 7 percent Friday to 91 7/8; Merrill Lynch shares rose 8.3 percent to 69 3/4; and Morgan Stanley shares rose 9.3 percent to 74 3/16.
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