Morgan Stanley Honored in ECM/World Equity Awards
ECM/World Equity is a quarterly publication owned by the International Financing Review. Thus, two of the ECM/World Equity awards that Morgan Stanley received were for deals also recognized by IFR.
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ECM/World Equity is a quarterly publication owned by the International Financing Review. Thus, two of the ECM/World Equity awards that Morgan Stanley received were for deals also recognized by IFR: U.S. Initial Public Offering of the Year for Conoco and Asian Equity-Linked Issue of the Year for Fullerton Global Corp/Temasek Holdings. In addition, Morgan Stanley garnered the following awards:
Privatization Auction: Telebras
Morgan Stanley, alongside Salomon Smith Barney, served as advisor to the Brazilian government in
its US$19Bn sale of Telebras, Brazil's twenty-six company telecoms monopoly. Morgan Stanley faced a significant challenge in designing the transaction, as ECM noted: "The goals of the Telebras privitisation went well beyond raising cash for the government... The buyers of Telebras needed to bring technology to the table as well as cash. The structure of the sale also had to ensure future competition within the former government-owned telecoms monopoly."
That the deal met these goals amid difficult market conditions "in the end," stated ECM, "total proceeds represented a 150% premium to the per share market value of Telebras" renders the Telebras sale an example for other governments to emulate. In addition, ECM/World Equity named it Privatization Auction of the Year for 1998.
European IPO: Equant
ECM/World Equity named the Morgan Stanley joint lead-managed Equant initial public offering its European IPO of the Year based on its strong performance in a discouraging market. New issues experienced a downturn from market highs in July as "discerning investors quickly turned against them as the markets began to head south, causing the stocks to underperform both local indices and the sector comparables," noted ECM.
According to ECM, in contrast to the rest of the market, the Equant deal "made a spectacular double debut on the Paris Bourse and Nasdaq" and has since "consistently outperformed both the Nasdaq Composite Index and the CAC 40." Thus, Equant, the world's largest data network provider, generated more than the US$500MM in capital it needed from the transaction its IPO valued the company at US$3.7Bn to US$4.5Bn.
UK M&A Transaction: The Energy Group
In March, Morgan Stanley advised The Energy Group (TEG) in its acquisition by Texas Utilities Corp.
Texas Utilities acquired TEG for £4.4Bn after topping a bid from Pacificorp. ECM notes
that "Both Lazards and Morgan Stanley deserve plaudits for their joint role in the process."
Specifically, the publication praises Morgan Stanley's role in "convey[ing] to TEG the psychology of the U.S. utilities market... [and] in evaluating rival bids." The bid/counterbid nature of the transaction led ECM/World Equity to name the acquisition the ECM UK M&A Transaction of the Year.
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