Citi Taiwan has one of the busiest years in 2021 for its institutional businesses, supporting clients across different areas, including capital markets, merger & acquisition (M&A) and trade.
In the past couple of years, Citi has advised on five Taiwan-related M&A deals across many industries such as technology, consumer, renewables and financial services. These included transactions that were transformational in creating leading global players in their respective fields.
In 2021, Citi also helped raise billions of US dollars for Taiwan corporates across local and global capital markets, including pre-IPO placements, block trades, convertible and exchangeable bonds, and US dollar bond issuances.
“Taiwan is home to many world-class companies and we are committed to supporting their ambitions,” says Christie Chang, head of banking, capital markets and advisory for Citi Taiwan, and chair of Asia-Pacific corporate banking. “There is a massive transformation happening across all industries and with a global network, this has helped sharpen Citi’s dialogue with clients in Taiwan as they increasingly want a regional and global perspective.”
Citi has also seen solid growth in its local corporate bank business supporting companies with their banking needs domestically and internationally as supply chains evolve further. Some of the bank’s biggest growth in flows in 2021 have been across trade corridors involving Taiwan.
For instance, Taiwan-to-India has seen a close to 50% increase in flows and around 20% from Taiwan-to-Asean countries as companies invest further in diversifying their supply chains during 2021. The bank has likewise seen steady growth from inbound flows into Taiwan, most notably from companies in Australia, India and Japan.
In terms of advisory business, Citi has been involved in a number of significant M&A transactions in Taiwan this year. In January, the bank was an adviser in Affinity Equity Partners’ and TPG Capital’s sale of UTAC Taiwan to Sigurd Microelectronics Corporation for US$165 million, marking the local consolidation in the outsourced semiconductor assembly and test industry. This represented the largest global private equity exit transaction from the Taiwan market during the past three years.
Citi was the financial adviser to Taiwan Cement Corporation (TCC) in its €132 million (US$160 million) acquisition of a 60.5% stake in ENGIE EPS (now renamed as NHOA) from France-based energy company ENGIE. This is a transformational transaction as it strengthens TCC’s renewable energy capabilities with energy storage and eMobility solutions.
In another deal, Citi was the adviser to Auchan for the sale of a majority stake in RT Mart to PX Mart for NT$11.5 billion (US$410 million). This is the largest food retail transaction in Taiwan year-to-date following Auchan’s geographic repositioning to focus on core strategic markets.
In equity capital market (ECM) transactions, the bank was the sole placement agent in Taishin Financial Holdings’ block trade of Chang Hwa Bank for US$112 million in June this year to support Taishin’s acquisition of Prudential in Taiwan. It was the sole global coordinator and a joint bookrunner in United Microelectronics Corporation’s US$400 million NTD currency-linked exchangeable bond into Novatek in June, which represented the first exchangeable bond in Taiwan in the past decade with the highest premium achieved ever for Taiwan convertible bond and exchangeable bond offerings.
In other ECM deals this year, Citi was a joint bookrunner in Hon Hai Precision’s US$700 million NTD currency-linked convertible bond in July. It was also involved in ASUS’ block trade of Advantech for US$100 million in September and in Wistron’s block trade of Wiwynn for US$140 million in November.
In terms of debt capital market deals, Citi helped arrange the US$3.5 billion multi-tranche bond offering by TSMC in April and the US$4.5 billion four-tranche debut SEC-registered bond issuance by TSMC Arizona Corporation in October to support the company’s capital expenditures going forward.