Oslers leads way in tepid Q3
The third quarter of 2017 will not be fondly remembered as a banner period for activity in the capital markets: the issuers and their agents — the investment bankers and the law firms — were not as busy as they were earlier in the year, despite very strong equity markets and very low interest rates.
For t he t hree months ended Sept. 30 2017, issuers raised $ 29.441 billion of debt and equity, a level that was more than 20 per cent below what was garnered in the previous three months. All of that decline and then some can be attributed to the mere $6.532 billion of equity that was raised for the threemonth period, 63 per cent less than the $ 17.677 billion raised in the period ended June 30.
Accordingly, the numbers for the quarter became somewhat decent because debt issuance, at $ 22.91 billion, was up by 19.44 per cent from the $ 19.181 billion raised in the prior three months.
The Q3 numbers l ook even worse when compared with what occurred in the same period of 2016: back then $ 44.329 billion of debt and equity was raised, which translates into a 33.59 per cent decline in the recently ended quarter.
But if, as the saying goes, you are only as good as your last deal, the bragging rights among the law firms belong to Osler Hoskin & Harcourt. The firm, which is branded as Oslers, ranked first in advising issuers on corporate finance transactions.
In all it advised issuers on seven transactions that were valued at $9.516 billion. The firm acted for Bank of Montreal, and twice for the Bank of Nova Scotia on debt financings of more than $ 1 billion, and for an $873 million borrowing by Magna International.
The firm also acted for Hydro One on a $1.54 billion offering of convertible debentures, part of which will be used to finance the electricity utility’s acquisition of Avista Corp., a regulated electricity and natural gas utility based in Spokane with operations in Washington state, Oregon, Idaho, Montana, and Alaska.
“It’s certainly gratifying to have had some recent successes,” said Jeremy Fraiberg, co- chair of Osler’s Mergers and Acquisitions Group. “And it’s even more encouraging to see a rebound in the IPO market in 2017 after a challenging 2016.”
Fraiberg said Hydro One’s purchase of Avista, a deal that has not yet been completed, represents “a continuing trend of Canadian capital markets financing outbound acquisitions,” by Canadian issuers.
Oslers was comfortably ahead of second place McCarthy Tetrault, which also acted for seven issuers that raised $ 7.55 billion. McCarthy’s largest deals were three debt financings for Enbridge ($1.852 billion and $1.288 billion, both of which were done in the U. S and for $1 billion done in the domestic market.) and two for TD Bank ( one of which garnered $1.5 billion locally and the other, $1.21 billion south of the border.) McCarthy’s two largest equity financings were $ 350 million of preferred shares raised for TD Bank) and $ 345 million raised for Jamieson Wellness in that company’s initial public offering.
Stikeman Elliott, Torys and Blake Cassels & Graydon rounded out the Top Five in total deal value when advising issuers.
“We continue to be busy nationwide and are proud of our work in the Canadian capital markets, in acting both f or companies and underwriters across a number of industries,” said Jay Kellerman, the managing partner at Stikeman Elliott.
When it came to the number of deals, Blake’s was the most active, advising issuers on 12 deals in Q3. Torys was second with eight while Oslers, McCarthy’s and Stikeman had seven each.
Legal advisers also play a role in advising the underwriters on capital market financings. When that ranking is tabulated, Oslers also emerged as No. 1 in Q3, advising the underwriters on nine debt and equity transactions that raised $3.7 billion. That placed Oslers almost $ 1 billion ahead of second placed McCarthy Tetrault.
Fasken Martineau, which was ranked 16 th when it comes to advising issuers, was third ranked for advising underwriters.
Richard Steinberg, the leader of the corporate finance practice at Faskens, said the firm’s rankings in relation to the underwriters “show our very strong relationships with dealers. We have made lots of efforts to strengthen those relationships and we are very happy that the work we have done to strengthen those relationships is paying off.”