Buy-out Groups Generate $9bn in Fees
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A record $9bn of investment banking fees were generated by private equity groups in 2004. An increase of 67% over the $5.4bn in 2003. The figures illustrate how important private equity has become to the the investment banks. A range of highly profitable services are needed for the dealmaking business, including M&A advice, IPOs and loans. Dealogic, a data provider supplied the estimated figures. Total investment banking fees amounted to $53.3bn last year. Private equity groups lead by Kohlberg Kravis Roberts and Carlyle generated 17% of this. KKR and Blackstone were the largest payers. KKR alone paid $500 in fees. Deals included Vendex a Dutch Retailer and the flotation of Wincor Nixdorf. Apax partners was the only European group to make it into the top 10 with $222 in fees. The biggest area of fees was leveraged loans at $3.4bn, equity capital markets made $2.4bn. M&A advice tailed in with $2.2bn.
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