HSBC, JPMorgan and Credit Suisse stand to take a healthy slice of the action by underwriting Prudential’s $20bn (£13bn) cash call for American International Assurance.
The 162-year-old insurer is tipped to pay $735m in fees to the investment banks for underwriting and advising on the rights issue. Dealmakers will enjoy a three per cent upfront charge plus a 0.5 per cent success bonus, it is understood. The rates are higher than those paid by HSBC for its $19bn share placing last year.
The total haul taken by the investment banks – including Lazard, which is helping on the advisory side – could reach $1.5bn once legal and accounting costs are factored in.
The bonanza will eclipse the £240m generated by Kraft’s bid for chocolate maker Cadbury and will be a welcome windfall for the City’s rainmakers as 2010 gets underway.
AIG was advised by Goldman Sachs, Citigroup and Blackstone.