Keeping score: Breaking records in Qatar, Taiwan

Highlights from the Thomson Reuters Investment Banking scorecard:

This week’s $7 billion offering from the State of Qatar marked the largest bond offering from a Middle Eastern issuer on record and the second multibillion dollar offering from Qatar this year.  For year-to-date 2009, debt capital markets activity from Middle Eastern issuers totals $38.6 billion, a 120% increase over last year at this time.
The offering, which was led by Barclays, Credit Suisse, Goldman Sachs, JP Morgan and Qatar National Bank, bested the previous Middle Eastern record, a $3.2 billion offering from UAE-based real estate developer, Nakheel Co PJSC.

Taiwan’s Innolux Display Corp agreed to merge with Chi Mei Optoelectronics Corp, a manufacturer of LCD TV panels in a merger valued at $13.1 billion, including debt.  The deal ranks as the largest merger in Taiwan’s history.
M&A activity in Taiwan totals $26.1 billion for year-to-date 2009, nearly five times last year’s total and the largest annual period for M&A activity in Taiwan on record.  High technology mergers account for just over 60% of activity in Taiwan this year, while financials account for $6.1 billion or 23%.

Germany’s Unitymedia GmBH, a provider of cable television and internet services was acquired by Englewood, Colorado-based Liberty Global Inc in a deal valued at $5.2 billion.  A portfolio company of BC Partners and Apollo Management LP, the sale marks the biggest M&A exit for a buyout consortium this year.
Worldwide M&A activity for buyout-backed companies totals $75.0 billion for year-to-date 2009, a 58% decrease from last year at this time when activity totaled $177.5 billion.

Deals du Jour

China’s Sichuan Tengzhon Heavy Industrial Machinery Co became the surprise buyer for General Motor’s Hummer brand while insurer AIG — another U.S. giant in trouble — cut the asking price for its Taiwan insurance unit. For the day’s top headlines, click here.

And here is what we found of interest in the newspapers.

Global miner Rio Tinto may cut the size of its planned $7.2 billion issue of convertible bonds to China’s Chinalco and raise more equity via a rights issue, the Australian Financial Review reported.

Banks in Qatar, the world’s top exporter of liquefied natural gas, will get cash and bonds in exchange for selling their real estate investments to the government under a $4 billion programme unveiled last week, the daily Gulf Times cited sources as saying.

Qatar Hero

guitar-hero.jpgInvestors buying freshly diluted equity has become something of a refrain in Europe. Barclays raised 4.5 billion pounds ($8.8 billion) from investors including Qatar and Japan’s Sumitomo Mitsui to rebuild capital and pursue growth. That drove the London bank’s shares up more than 5 percent. Existing shareholders will get a chance to buy up to 4 billion pounds of shares at a discount, with outside “anchor” investors underwriting the fundraising. The fact that the capital raising was well-flagged and successfully completed was enough to encourage buyers.

Also rising 5 percent were shares of UBS, as the New York Post reported the Swiss banking giant has hired Lazard to conduct a strategic review, lending a touch more credence to the talk that the bank is looking to split its wealth management and investment banking businesses. UBS’s share could also be reacting to the Barclays news, which shows that sovereign wealth funds haven’t gone into hiding.

Qatar, which on Tuesday agreed to sell 25 percent of its stock market to NYSE Euronext, is in talks with London and German stock exchanges about new partnerships, according to Al Arabiya Television. Qatar, the world’s biggest exporter of liquefied natural gas, agreed to sell a stake in the Doha Securities Market for $250 million in a bid to become the booming region’s financial hub. “Qatar is in talks with the London Stock Exchange and the bourse in Germany to build new strategic partnerships,” Al Arabiya Television reported, citing Hussein al-Abdullah, executive board member for the $60 billion Qatar Investment Authority.

Oiling the Barclays machine

BarclaysWhen you need some fast cash, you can always count on oil money. Qatar’s sovereign wealth fund is reportedly considering backing a share issue by Barclays. You’ll recall that earlier this week Britain’s No. 3 bank said it would sell billions of pounds worth of shares to bolster its stretched balance sheet. The Financial Times quotes a person close to the Qatar Investment Authority as saying “We’re looking at it.” The QIA manages about $60 billion in assets and earlier this year bought under 2 percent of Credit Suisse. Qatar, which is the richest Arab country on a per capita basis thanks partly to high oil prices, is looking to spend between $10 billion and $15 billion over the next two years on bank stakes, Prime Minister Sheikh Hamad bin Jassim al-Thani told Reuters in February.

Of course, it’s not just the oil-rich out there poking around those struggling banks. Activist shareholder Olivant said on Wednesday it had raised its stake in Swiss bank UBS, which has been hit by massive losses on risky investments, to 2.5 percent. Olivant, headed by former UBS Chief Executive Luqman Arnold, said by taking a stake worth about $1.8 billion it was “demonstrating its belief in the potential restoration of shareholder value achievable through decisive action on the part of the UBS board”. Interpretation: We want change. How about splitting up the bank?

If banks aren’t your thing, there’s always Hollywood. Movie studio DreamWorks SKG is close to a deal with India’s Reliance ADA Group to form a new movie venture, the Wall Street Journal reported on Tuesday, citing people familiar with the talks. The Journal said a deal with Reliance would give movie director Steven Spielberg the cash to finance his DreamWorks team’s departure from Viacom Inc’s Paramount Pictures later this year.