FinanceAsia Achievement Awards 2023: The rationale behind ANZ's best deals

Read the rationale behind the winners of the best deals in Australia and New Zealand for the FinanceAsia Achievement Awards 2023.

Feb 20, 2024 - 21:01

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Welcome to the rationale winners of the best ANZ Deals in the FinanceAsia Achievement Awards 2023. In another challenging year for Asia’s markets as the world’s investment community dealt with higher for longer interest rates and an unexpected slowdown in China, the winners proved they had the flexibility and staying power to adapt amid intense competition.

Our annual Awards covered the period from October 1, 2022 to September 30, 2023 and are split into four major categories.

Now in our 27th edition, the quality of the awards’ entries continues to improve, giving our judges a tough time when choosing the winners. We had more than 680 high-calibre entries from a combination of banks, other financial institutions, rating agencies and law firms, which showcased the very best of Asia Pacific’s financial markets.

The firms listed below are based on the entries and additional research from FA; it is not necessarily a complete list.

We also this year for the first time introduced our DealMaker Poll Awards -- the winners are here.

Congratulations to the winners of the Awards – the success is very well deserved. We would also like to thank all the firms that entered, and to our judges:

Agnes Chen – regional managing director, Apac, CSC Global Financial Markets
BK How – regional managing director, Ofisgate
Gabriel Wilson-Otto – head of sustainable investing strategy, Fidelity International
Hironobu Nakamura – chief investment officer, Asset Management One Alternative Investments (AMOIA)
Manoj Agarwal – managing director, head debt capital markets Apac, BNP Paribas
Myles Mantle – partner, Mayer Brown
Peter Armstrong – partner, DLA Piper
Richard Liao – CEO, Hwahsia Glass
Wivinia Luk – senior manager (policy research), Financial Services Development Council (FSDC)

DEAL AWARDS - ANZ

BEST BOND DEAL

Commonwealth Bank of Australia's (CBA) A$1.55 billion ($1 billion) PERLS XVI capital notes

PARTICIPANTS: CBA, ANZ, Bell Potter, Morgan Stanley, Morgans Financial, National Australia Bank, Ord Min-nett, Shaw and Partners, UBS, Westpac Institutional Bank / ADVISORS: Herbert Smith Freehills, Allens

CBA reset market expectations for Additional Tier 1 (AT1) hybrid securities in May 2023 with the first retail offer-ing of AT1 capital in Australia – and one of the first globally – since Credit Suisse’s write-down a couple of months earlier.

The transaction spurred the reopening of the AT1 market at a time when investor confidence was rattled. More specifically, the deal enabled CBA to achieve its strategic objective of raising AT1 capital in a ‘new money only’ offer, since the issuer didn’t have any upcoming AT1 redemptions in 2023.

The transaction size reflects the broader success of the deal; it was at the upper end of the bank’s aspirations in terms of volume, following a well over-subscribed order book after an accelerated bookbuild on the back of strong demand. The pricing represented a flat new issue premium.

BEST DEBT FINANCE DEAL

AirTrunk’s A$4.67 billion ($3.1 billion) equivalent sustainability-linked syndicated senior debt facilities

PARTICIPANTS: Crédit Agricole CIB, Deutsche Bank, HSBC, DBS, ING, Morgan Stanley, MUFG Ban / ADVISORS: King & Wood Mallesons

AirTrunk’s sustainability linked loan (SLL) set some new industry benchmarks, including being the largest SLL for a data centre operator globally, and becoming the biggest loan deal of 2023 in Australia.

Yet the impact of this landmark SLL is much more extensive, driving the industry forward by redefining sustaina-ble financing standards.

Notably, it achieved a combination of innovative key performance indicators (KPIs) linked to top-of-mind environ-mental and social focus areas. For example, it was the first SLL to utilise carbon usage effectiveness as a loan KPI, and the first to combine carbon, energy and water usage effectiveness as loan KPIs. Further, it was the first SLL by a data centre operator to incorporate gender pay equity KPI, and the first to use margin incentives to fund social impact programmes across Asia Pacific and Japan.

At A$4.6 billion ($3 billion), this refinancing was more than double the firm’s initial A$2.1 billion SLL in 2021, giv-ing the loan market a unique opportunity to acquire high quality data centre paper.

BEST EQUITY DEAL

Ryman Healthcare’s NZ$902 million ($563.4 million) Paitreo

PARTICIPANTS: UBS, Macquarie / ADVISORS: Bell Gully, Russell McVeagh, Sidley Austin, Baker McKenzie

This pro-rata accelerated renounceable entitlement offer with retail rights trading (Paitreo) was the first ever for a company listed on New Zealand’s stock market, NZX. It was important for Ryman Healthcare to take this ap-proach, enabling the firm to reset its capital structure to provide it with funds to strengthen its balance sheet by repaying debt. Another benefit was maximising fairness for all shareholders, who could participate in the offer on the same terms.

Other stand-out elements of the transaction include it being the third largest follow-on raising in New Zealand, and the first ever Paitreo with a retail oversubscription facility. This second, innovative feature accommodates the ability for retail shareholders to apply for shares in excess of their entitlement.

At the same time, confidentiality was preserved throughout the entire process up until launch with no leak, de-spite previous market speculation of an equity raising by the company.
The deal was met with strong support from both existing and new institutional investors

BEST M&A DEAL

BHP’s A$9.6 billion ($6.44 billion) acquisition of OZ Minerals

PARTICIPANTS: Barrenjoey, Citigroup

The success of this takeover enabled BHP to achieve its goal of becoming a leader in energy transition, given that copper and nickel are essential to support the megatrends of decarbonisation and electrification.

The purchase was a landmark from a deal making perspective, too. It represented the largest all-cash Australian Securities Exchange mining transaction of all time, the largest all-cash global mining transaction in 2022, and the second-largest all-cash copper transaction of all time.

To achieve this, the transaction overcame some significant setbacks. For example, BHP’s initial offer was reject-ed by the OZ Minerals board in August 2023, but a revised proposal eventually secured a unanimous recommen-dation three months later. OZ Minerals shareholders received cash certainty and an attractive 49% premium to the undisturbed price.

This followed an already-extended timetable of around nine months – from initial approach to completion – requir-ing the deal to navigate a period of high market volatility and large movements in commodity prices during this time.

BEST NEW ZEALAND DEAL

BGH and Sixth Street’s NZ$1.7 billion ($1 billion) acquisition of Pushpay

PARTICIPANTS: Craigs, Macquarie, Goldman Sachs / ADVISORS: Bell Gully, Harmos Horton
Lusk, Shearman & Sterling, Willkie Farr & Gallagher

This was one of the largest takeovers executed in the New Zealand market over the last decade. It ultimately required an innovative cooperation strategy between BGH Capital and Sixth Street Partners to win a competitive sales process, with the funding package achieved despite volatile markets against a backdrop of rising interest rates.

The acquisition of Pushpay was also pioneering in the domestic market for being the first time that differential consideration was given in a takeover transaction. In this case, it allowed the bidders to execute the transaction while meeting return thresholds, and therefore led to strong support by shareholders, with the majority of votes cast in favour of the Scheme Implementation Agreement.
This was notable given that two months earlier, a shareholder vote for the Scheme failed due to a number of New Zealand-based institutional shareholders being unsupportive of the offer.

As a result, it has set a precedent in New Zealand for future Scheme transactions.

BEST PROJECT FINANCE DEAL

Perdaman Chemicals & Fertilisers’ $2.475 billion project financing

PARTICIPANTS: MUFG Bank / ADVISORS: White & Case

The club facility package that the Perdaman Group and Global Infrastructure Partners (GIP) secured for the con-struction of a new urea plant in Western Australia, will greatly add to food security in the Asia Pacific region.

Perdaman’s investment into this project, which was more than 15 years in development, is the largest ever made in the Australian fertiliser industry. When completed, it will be the largest urea plant in Australia and one of the largest in the world.

The facility will help to ensure that Australia has a secure and reliable source of high-quality urea, supporting the nation’s farmers and food producers.

The Australian government provided significant funding for the urea plant. Via the Northern Australia Infrastruc-ture Facility, this included funds for a new multi-user wharf and facilities, and to expand seawater supply. Export Finance Australia also provided a loan to the project.

BEST STRUCTURED FINANCE DEAL

Judo Capital Markets Trust 2023-1; A$500 million ($336 million) public asset backed securities transac-tion

PARTICIPANTS: Citi, Société Générale, ANZ, RBC, Westpac

A striking feature of this deal – in a securitisation market historically dominated by residential mortgage-backed securities – was that it offered asset-backed securities (ABS) with collateral consisting of a pool of mixed purpose, prime bank loans to small- and medium-enterprise (SME) businesses.

This had not been done before; traditionally, SME business loans have been kept on bank balance sheets.

The transaction’s success partly rested on early investor sounding and education. Although this led to an extend-ed execution timeline of around eight months, it resulted in the benefit of crowding-in a broader number of inves-tors into the deal.

By structuring and distributing the deal in a way that provided funding and regulatory capital relief for the issuer, the transaction has laid foundations for Judo’s ABS programme. In addition, going forward, it will add to collateral diversity and the development of a broader ABS market for Australia’s securitisation industry.

BEST SUSTAINABLE FINANCE DEAL

NZGIF Solar Finance’s NZ$170 million ($106 million) solar finance programme debt issuance

PARTICIPANTS: Société Générale

New Zealand Green Investment Finance (NZGIF) set the tone for climate-aligned debt with this Climate Bonds Initiative (CBI) certified solar loan, which will initially finance the country’s largest residential Power Purchase Agreement (PPA) portfolio.

It attracted just over half of the total investment needed from First Sentier Investors and Natixis Investment Man-agers, with NZGIF providing the rest. In line with this support, it represents NZGIF’s first private debt placement with international co-investors, and provides the long-term, fixed rate debt required to accelerate distributed solar in New Zealand.

The cornerstone investors liked the fact that this initiative took a whole-of-country approach to reducing emissions associated with electricity usage.

More broadly, the programme is also the first issuance by a New Zealand-based financial institution to secure CBI certification. Such certification is used globally by bond issuers, governments and investors, and is only awarded after a science-based assessment of sustainability attributes.

MOST INNOVATIVE DEAL

EIG and Brookfield’s A$19 billion ($17.8 billion) proposed acquisition of Origin Energy

PARTICIPANTS: Citi, MUFG Bank, UBS, JP Morgan, Barrenjoey, Jarden

The lofty goal of this landmark transaction was to accelerate decarbonisation of the energy grid and help Austral-ia progress towards its net zero goals. To achieve this, the proposed acquisition of Origin by EIG and Brookfield involved a highly complex and creative consortium break-apart of Origin’s Integrated Gas and Energy Markets divisions.

Ultimately, the deal offered shareholders a consideration mix of US dollars and Australian dollars, plus may un-lock significant value creation. The proposal was also the biggest cash bid since the Sydney Airport acquisition in early 2022.

Among the various challenges and risks to ensure a successful outcome, the break-up proposal of Origin relied on two innovative and pioneering features: firstly, the construction of a consortium between EIG and Brookfield so each party could fulfil its own investment objectives; and secondly, the mixed currency scheme consideration, in which EIG contributed only US dollars into the mix, eliminating any foreign exchange risk with Australian dollars.

ANZ DEALS -- HIGHLY COMMENDED

BEST BOND DEALS

AusNet Services' A$1.2 billion ($786.3 million) 10-year senior unsecured fixed rate notes

PARTICIPANTS: ANZ, CBA, NAB, Westpac, MUFG Bank

BEST M&A DEALS

Allkem's A$15.7 billion ($10.3 billion) merger of equals with Livent

PARTICIPANTS: Morgan Stanley, UBS

BEST PROJECT FINANCE DEAL

Wellington Sludge Minimisation Facility's NZ$400 million ($245 million) project financing

PARTICIPANTS: The Accident Compensation Corporation (ACC), CCB, CBA, ICBC

BEST STRUCTURED FINANCE DEAL

Wellington Sludge Minimisation Facility's NZ$400 million ($245 million) project financing