Q3 and YTD 2018 SPAC IPO Underwriting League Tables

Underwriting-League-Tables

Q3 and YTD 2018 SPAC IPO Underwriting League Tables

Below are the recently released Q3 & YTD 2018 SPAC IPO Underwriting League Tables

This quarter we switched things up and added two new columns to the rankings.  For background, in our previously published league tables we used a traditional methodology favored by most league table providers. That is, any underwriter that is a book-runner or lead manager gets full credit for the IPO size and this calculates Deal Volume for each underwriter. However, going forwarded we have also calculated two new columns (highlighted in green) that take into account the number of units sold, which you can find in the underwriting section of all final prospectuses.

New Methodology:
For example, if SPAC-XYZ raised $500 million at IPO, and underwriter A sold $400 million of the same deal and underwriter B sold only $100 million, that’s how they will be credited.  This methodology gives a more accurate window into the actual deal volume.

We also went back and re-calculated a Year-To-Date (YTD) table in order to have a consistent view of the Underwriting League for 2018 that also took into account the new methodology.  Below is a summary of the results.


Q3 2018

Ranked by Volume

(All data is sort-able using the arrow keys located in the header cells)

RankUnderwriterVolume
($mm)
Volume
% Mkt Share
Volume
Sold
($mm)
Volume
Sold
% Mkt Share
Deal
Count
Avg. Size
($mm)
1Citigroup1,242.035.7%743.436.1%2621.0
2Credit Suisse552.015.9%158.47.7%1552.0
3Chardan408.811.8%206.310.0%4102.2
4Deutsche Bank400.011.5%375.018.2%1400.0
5EarlyBirdCapital250.07.2%206.310.0%1250.0
6Jefferies
200.05.8%160.07.8%1200.0
7Cantor Fitzgerald189.55.5%131.06.4%294.8
8BTIG169.34.9%22.51.1%1169.3
9Maxim Group
63.31.8%55.02.7%163.3

Source: SPACInsider, Ranked by volume

Citigroup leads the Q3 rankings by a wide margin for the third quarter based on total deal volume as well as volume sold (green columns). This is thanks to Citi bookrunning the two largest SPACs to IPO this summer – Spartan Energy ($552 million) and Churchill Capital ($690 million). Furthermore, Citi is bookrunning the forthcoming Collier Creek at $350 Million.  Citigroup does not do small deals.  In boxing parlance, they are super heavyweight class.

If we focus on volume sold, Deutsche Bank ranked #2 despite completing only one SPAC from a bookrunner or lead position, yet still managed to put away $400 Million by themselves with Gores Holdings III. Impressive considering they could have easily upsized Gores III, but chose to hold back and stand at $400 million.

But making a really strong showing in Q3 was Chardan, which took the #3 spot based on total deal volume and the #1 spot based on deal count, at 4 SPACs total.  Plus, if we look at volume sold, Chardan still managed to rank # 3, tied with EarlyBirdCapital, at $206.3 million.

And here’s where things get really interesting using the new methodology… Credit Suisse, consistently at the top of the league tables, placed second behind Citi if we rank based on deal volume (traditional method). However, if we rank based on volume sold (new method) Credit Suisse is now ranked sixth. But….let’s take a look at YTD so we can evaluate using a larger pool of SPACs to smooth out any short term irregularities.


YTD 2018

Ranked by Volume

(All data is sort-able using the arrow keys located in the header cells)

RankUnderwriterVolume
($mm)
Volume
% Mkt Share
Volume
Sold
($mm)
Volume
Sold
% Mkt Share
Deal CountAvg deal size
1Credit Suisse1,772.013.4%803.911.9%4443.0
2Chardan1,593.512.0%499.37.4%10159.4
3Citigroup1,442.010.9%943.413.9%3480.7
4BofA Merrill Lynch1,257.59.5%475.57.0%3419.2
5Deutsche Bank1,250.09.4%751.811.1%4312.5
6Goldman Sachs1,215.09.2%711.310.5%3405.0
7EarlyBirdCapital1,098.58.3%634.79.4%6183.1
8Cantor Fitzgerald828.06.2%544.08.0%5165.6
9B. Riley FBR625.34.7%515.57.6%3208.4
10Oppenheimer & Co.414.03.1%174.72.6%1414.0
11UBS287.52.2%97.51.4%1287.5
12Citic CLSA258.01.9%50.00.7%1258.0
13Cowen230.01.7%165.02.4%1230.0
14Jefferies200.01.5%160.02.4%1200.0
15Dowling & Partners172.51.3%42.00.6%1172.5
16BTIG169.31.3%22.50.3%1169.3
17Raymond James155.31.2%44.60.7%1155.3
18Ladenburg115.00.9%92.51.4%1115.0
19CIM Securities115.00.9%0.50.0%1115.0
20Maxim Group63.30.5%55.00.8%163.3

Source: SPACInsider, Ranked by volume

Looking at the Year-To-Date (YTD) rankings for 2018, we see Credit Suisse topping the list based on deal volume (traditional method).  Plus, if we sort based on the new method (volume sold) they’re still right up near the top at #2.  This is not surprising since Credit Suisse is a consistent leader in SPAC underwritings.

However, the ranking that really jumps out is Chardan’s deal count, which is currently at 10 SPACs heading into Q4. Wow, Chardan has been busy. The nearest competitor is EarlyBirdCapital, with six deals so far for 2018.  Plus, if we rank YTD 2018 based on volume (traditional) Chardan is #2, right behind Credit Suisse, which is a herculean effort for a boutique bank going up against heavyweights such as Credit Suisse, Deutsche Bank and Citigroup.

Moving further down the list, we see Citigroup ranked #3 for deal volume, yet #1 for deal volume sold.  Citi was a bit quiet for the first half of 2018, but they’ve certainly made up for it in Q3 with Spartan Energy and Churchill Capital. Another one to watch is BofA, currently ranked #4 by deal volume.  BofA is an underwriter on the Collier Creek deal and my intuition tells me that won’t be the last we hear from them.  They could easily move up the rankings in Q4.

Nevertheless, we can slice and dice the rankings however we see fit.  But for those that argue that the league tables seem to give too much weight to much larger deals and big SPACs are sometimes not appropriate for an individual SPAC’s sector focus (for instance, would a $300+ million SPAC make sense for EdtechX? Nope), consider that winning the bookrunner or lead position for a very large SPAC with an A++ team is an incredibly difficult endeavor.  Plus, the underwriter then has to sell that $300 million+ to investors.  The underwriters of those deals should be recognized and therefore, the League Tables (for better or worse) are probably pretty reflective of an accurate ranking.

Now that we’re heading into Q4, we already have six SPACs lined up to price this month.  Plus, if the rumors are true…we have quite a few more getting ready to file. The fourth quarter is going to be HEAVY, so year end might see some further shuffling of the rankings.  Lastly, we also have a few wild cards with Jefferies, UBS and Oppenheimer and we also got to see BTIG make their debut in the rankings this go around.  Any of these banks could make a big push by year end, so we may have some surprises.  It’s going to be an interesting quarter for sure and we’re looking forward to seeing what develops.

You can find all the League Tables by clicking here.

 

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