Citigroup has pulled clear of rivals to top the latest league table of financial advisers on European leveraged buyout deals, moving up from the third place ranking it held at the end of the first quarter.
Citigroup’s move to the top comes thanks to its roles on two Nordic deals announced in April, bringing the total value of deals advised on to more than US$18bn, ahead of Deutsche Bank on US$14.8bn and Rothschild on US$14.3bn.
Citigroup is advising, alongside Merrill Lynch and KPMG Corporate Finance, working on the sell side of Compass Group’s US$3.1bn sale of Swedish catering services provider Select Service Partners, one of the largest ever buyouts in the region. Dresdner Kleinwort Wasserstein advised buyers Macquarie Bank and EQT Partners on the deal.
Its latest role on a European LBO was on another sizeable Nordic buyout, acting alongside Enskilda on HgCapital newco Engel Holdings’ purchase for US$673m of Visma, a Norwegian business software firm, trumping an earlier bid from UK-based trade buyer Sage Group.
Those deals have put significant distance between Citigroup and rivals Deutsche Bank and Rothschild, both of which had finished the first quarter fractionally ahead of the US bank – having acted on deals worth US$14.39bn and US$14.34bn respectively at that time, compared with Citigroup’s US$14.26bn.
Citigroup’s advisory work has been exclusively on the biggest deals of the year – the six deals it has advised on so far this year have all been among the top 10 announced, none of which is smaller than the US$673m Visma offer.
Deutsche Bank and Rothschild have each acted on three of the very biggest deals, which form a tiny minority of the overall deal market.
In fact, a review of the deals announced so far this year highlights the relatively strong level of activity at the top end of the market – there have been 14 deals announced so far with a disclosed value of more than US$500m – nine of them worth over US$1bn.
Interestingly, the fact that almost the same number of deals, 15, have been announced in the upper mid-market of US$200m to US$500m, suggest a real paucity of activity in precisely the area of the market most well known private equity concerns see as their core turf. The lower end of the market accounts for around 87% of all deals.
This mid-market scarcity also accounts for the sharp fall in the value of deals advised on by the top ranked firms and those further down the table, despite many of the lower ranked firms having acted on a number of deals.
“Big four” professional services groups KPMG and PricewaterhouseCoopers look to have carved out significant markets for themselves among these smaller deal, with 16 and 15 transactions advised on respectively.
Rothschild’s work on 13 deals in all means it ranks third in the market both in terms of the value of deals advised on and the number of mandates won.