Irish companies have proved to be source of rich pickings for investment bankers and corporate lawyers so far this year.
With Tullow Oil – which we still claim as our own a decade and a half after it moved its domicile to London – currently raising £607 million (€710 million) through a share sale to lower the burden of its $4.8 billion (€4.5 billion) net debt pile, advisers are on track to pocket $27 million.
Firms underwriting the transaction, including Barclays, JP Morgan, with Davy acting as the Irish broker, will receive almost $20 million of that amount.
Meanwhile, after years of will-he, won't-he speculation, Dublin financier Paul Coulson finally floated his Ardagh glass and metal containers group in New York last month, raising $319 million as it sold a 6.9 per cent stake. Backers, including US trading giant Citadel are sitting on 12 per cent paper gains three weeks after the initial public offering. But the advisers on the deal have reaped cold, hard cash. Almost $40 million of the stuff.
Fees and expenses
The underwriters – Citigroup, Deutsche Bank, Goldman Sachs, Barclays, Credit Suisse, JP Morgan, Davy and Wells Fargo – have so far earned $18.5 million. This could rise to $21.2 million if they take up their right to buy further stock from Ardagh by April 24th and place it in the market. Other fees and expenses have come to $14 million.
Bank of Ireland's legal move in the past week to set up a new holding company (to prepare for new EU rules to minimise taxpayer bailouts in the event of future crises) is set to cost €10.5 million in expenses. We hear that law firms – including Arthur Cox, Allen & Overy and Sullivan & Cromwell – were the main earners on this occasion as they waded through mountains of legal paperwork. Brokers UBS and Davy will also earn their cut.
But it's nice to see the Department of Finance has beaten down advisers involved in the upcoming sale of a 25 per cent stake in AIB. This is going to be a vanity transaction for everyone involved, including Bank of America Merrill Lynch, Deutsche Bank, Davy, Goodbody Stockbrokers and Goldman Sachs. They will receive between €10 million to €13 million for the pleasure, according the department.
