Canadian financial services group Canaccord Genuity’s aims to double the contributions to its investment banking business from the Middle East and India in the next five years, its regional head told Reuters.
It recently helped broker a C$5 billion ($3.7 billion) investment partnership between Dubai ports operator DP World and Caisse de depot et placement du Quebec, Canada’s second-largest public pension fund.
“We think this could be the first of many,” said Sachin Mahajan, Canaccord Genuity’s managing director and head of Middle East, North Africa and South Asia.
“There are crown jewels in this region where the funds can find strategic alliances and partnerships.”
Canaccord Genuity is also in discussions with large European and North American private equity funds, pension funds and hedge funds about potential investments in Saudi, United Arab Emirates and India, Mahajan said.
The discussions include current transactions within logistics, infrastructure and healthcare, he said, declining to name the companies.
Canaccord Genuity is competing with boutique advisory firms such as Rothschild & Co, Moelis & Co and Lazard at a time when investment opportunities in the oil-rich states of the Middle East are taking off as low oil prices hasten asset sales and debt restructuring.
Another investment bank, Evercore Partners, is planning to open an office Dubai, two industry sources said.
Canaccord opened an office in Dubai in 2015, with the aim of targeting opportunities in Saudi Arabia, UAE, Egypt and India.
Its initial focus has been on advisory opportunities for mergers and acquisitions and corporate finance, before diversifying into areas such as research, sales, trading, markets and wealth management, said Mahajan.
The Middle East, North Africa and South Asia accounts for around 5 percent of Canaccord’s global business, a level it expects to rise to around 10 to 15 percent within the next five years, Mahajan said.
The Gulf states, historically net exporters of capital, are seeking investments to help plug budget deficits which have widened as a result of lower oil prices.
Saudi Arabia is seeking to sell shares in Saudi Aramco in what is expected to be the world’s biggest initial public offering, and a move which Mahajan said would create a lot of opportunities for advisory work.
“Now, there’s a limited time window – the next five years maybe – as this region recalibrates itself to the new oil reality where there will be a requirement for capital,” he said.