Deal maker Li Ka-shing and son Victor push CK Hutchison group of companies to the top of the league for advisory fees in Asia

Li Ka-shing, the Hong Kong tycoon known affectionately as “Superman” for his deal making prowess, was the biggest patron of investment banks and takeover consultants, with his flagship companies paying as much as US$126.9 million in fees in the past five years, according to a report by data provider Dealogic.

The two listed flagships, CK Hutchison and sister company CK Asset Holdings, chaired by Victor Li Tzar-kuoi who took up the roles after his father retired in May last year, together with their listed units Cheung Kong Infrastructure and Power Assets Holdings, paid advisory fees of US$126.9 million related to 21 acquisitions and asset sales since 2015. This is based on the calculations of announced deals, including debts, worth US$150 billion.

Chinese airline-to-finance conglomerate HNA Group, which is selling assets to cut debt, was in the No 2 slot with advisory fees totalling US$115.6 million relating to 40 deals worth US$32.7 billion during the five-year period.

China National Chemical Group, Alibaba Group Holding and China Resources ranked in the third, fourth and fifth places respectively by advisory fees.

Merger and acquisition activity in the Asia-Pacific region softened to its slowest pace in five years in the first quarter, according to financial data provider Refinitiv. The value of announced deals, including net debt, amounted to US$186.7 billion, a 33 per cent decline from US$280.4 billion last year and the worst first quarter since 2014.

April was not much better, with M&A activity in Asia-Pacific totalling US$55.3 billion, the lowest total for the month since 2013, according to Refinitiv.

Dealogic said “the recent intense regulatory control” on mainland companies investing in the US and Europe had dampened overall deal activity in Asia, with the value of M&A activity easing 29.7 per cent to US$193.1 billion during the first quarter.

Before stepping back to a role of senior adviser at CK Hutchison, Li Ka-shing engineered the restructuring of his business empire by envisioning CK Asset as the flagship for his hotels, office towers, commercial property and housing projects. Non-property assets including Hutchison Port Management, telecommunications, A.S. Watsons retailing, infrastructure and energy were injected into CK Hutchison Holdings. Two transactions in this internal asset shuffle were counted as part of the group’s overall M&A activity.

Since Li’s retirement, his elder son Victor Li has taken up his mantle. CK Asset made over HK$100 billion (US$12.7 billion) of acquisitions in 2017 and 2018, Gerald Ma Lai-chee, CK Asset’s general manager of corporate business development, said in an interview with South China Morning Post last month.

Excluding these deals, the group completed M&A activity, including debts, worth US$60.26 billion from 2015 with the biggest acquisition being Wind Tre SpA for US$16.33 billion completed in June 2018, according to Dealogic.

Additional reporting by Chad Bray

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