WALL STREET PAYDAY: Dealmakers could pull in $330 million in fees from takeover frenzy

  • Investment bankers could make nearly $US330 million in deal fees combined following the announcement of three megadeals on Sunday and Monday.
  • The deals include a $US26 billion merger between telecom giants T-Mobile and Sprint; oil refiner Marathon’s acquisition of Andeavor for $US23 billion; and Wal-Mart’s sale of its UK grocery business Asda to Sainsbury for $US10 billion.

Mergers and acquisitions are back.

M&A bankers are set to split nearly $US330 million in fees from three megadeals announced over Sunday and Monday, according to consulting firm Freeman & Co.

These deals include a $US26 billion merger between telecom giants T-Mobile and Sprint; oil refiner Marathon’s acquisition of Andeavor for $US23 billion; and Wal-Mart’s sale of its UK grocery business Asda to Sainsbury for $US10 billion.

The spoils will be split between no fewer than 13 investment banks, with Goldman Sachs and Morgan Stanley landing roles on two of the three big deals. Here’s how the fees break down across the three deals:

In telecoms, PJT, Goldman Sachs, Deutsche Bank and Morgan Stanley will split $US50 million to $US70 million for representing T-Mobile and Deutsche Telekom on the deal, while Raine Group, Centerview Partners, JPMorgan, Mizuho and SMBC Nikko will split $US60 million to $US80 million in fees for advising Sprint and SoftBank.

In oil, Barclays is expected to collect $US35 million to $US45 million for advising Marathon, while Goldman will receive $US50 million to $US60 million in fees for its work with Andeavor.

And in retail, Credit Suisse and Rothschild will split $US30 million to $US40 million in fees for advising Wal-Mart and UBS and Morgan Stanley will earn $US20 million to $US30 million for advising Sainsbury.

The latest deals are just the latest in a red-hot environment for M&A this year. Global M&A volumes during the first three months of 2018 were their highest ever, thanks to US tax reform and stronger economic growth in Europe.

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