THIS
POST WAS ORIGINALLY PUBLISHED MAY 30, 2007
Bankers Feeling Better in Europe than in the USA
Bloomberg released data
on IPO underwriters and their fees. For the first time since World War
II the US bankers are on the verge of earning less from initial public
offerings than in Europe. As American underwriters continue to charge
double the going fee rate on European IPOs, the total amount of money
raised in Europe so far this year is 78% greater than the value of U.S.
offerings. Many companies look to list in Europe. IPOs in Europe have raised $37.8 billion so far this year, exceeding the $21.2 billion of stock sold on U.S. exchanges.
And it is natural: the Enron events resulted in heightened reporting
and accounting controls in the form of Sarbanes-Oxley (SOX) legislation.
A survey of public companies concluded that the overall cost of being public increased 33% in the year after SOX was adopted, with a 174% increase in compliance costs.
Bloomberg cites that fees in Europe range from 1% to 5.4%, and as I mentioned earlier (The Beauties of Russia for Investment Banks and Bankers) VTB IPO’s fees were 1.6%. This all compares to 7% average US fees.
It is interesting to compare Bloomberg’s data on IPO coordinators ratings with the Russian ones.
Bloomberg states for the global:
1. UBS AG
2. Goldman Sachs
3. Merrill Lynch & Co
European:1. Goldman Sachs
2. Deutsche Bank
3. Citigroup and JPMorgan.
ReDeal in collaboration with PWC published 2006 rating of underwriters and coordinators of Russian IPOs:
Underwriters:
1. Dresdner Kleinwort Wasserstein
2. Deutsche UFG
3. Morgan Stanley
Coordinators:
1. Morgan Stanley
2. Deutsche UFG
3. Dresdner Kleinwort Wasserstein
So, the presence of German investment banks is clear and visible. As I noted in my previous post there is an increasing attention of global investor community to the Russian stock market. It is obvious from the table that non-resident investors rush to Russia. And this week it was once again confirmed by the MICEX that the trading volume of Russian ADRs on MICEX is bigger than in London.
So, we do feel that Russia is making its good input in the growth of European stock market.
Bloomberg cites that fees in Europe range from 1% to 5.4%, and as I mentioned earlier (The Beauties of Russia for Investment Banks and Bankers) VTB IPO’s fees were 1.6%. This all compares to 7% average US fees.
It is interesting to compare Bloomberg’s data on IPO coordinators ratings with the Russian ones.
Bloomberg states for the global:
1. UBS AG
2. Goldman Sachs
3. Merrill Lynch & Co
European:1. Goldman Sachs
2. Deutsche Bank
3. Citigroup and JPMorgan.
ReDeal in collaboration with PWC published 2006 rating of underwriters and coordinators of Russian IPOs:
Underwriters:
1. Dresdner Kleinwort Wasserstein
2. Deutsche UFG
3. Morgan Stanley
Coordinators:
1. Morgan Stanley
2. Deutsche UFG
3. Dresdner Kleinwort Wasserstein
So, the presence of German investment banks is clear and visible. As I noted in my previous post there is an increasing attention of global investor community to the Russian stock market. It is obvious from the table that non-resident investors rush to Russia. And this week it was once again confirmed by the MICEX that the trading volume of Russian ADRs on MICEX is bigger than in London.
So, we do feel that Russia is making its good input in the growth of European stock market.
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