NEW YORK/TORONTO (Reuters) - Morgan Stanley, Barclays Plc and Royal Bank of Canada took the top spots advising Canadian mergers and acquisitions in 2016 as deals in the pipeline, power and utility sectors propelled deal volume to a nine-year high.
Deal value climbed 8.3 percent to $250.7 billion last year, from 2015 levels, according to data released by Thomson Reuters.
A number of large transactions, including Enbridge Inc's planned acquisition of Spectra Energy Corp for about $28 billion and a proposed merger between fertilizer producers Potash Corp of Saskatchewan Inc and Agrium Inc, drove deal activity to the second strongest year on record, after 2007.
Other major deals – such as TransCanada Corp's acquisition of Columbia Pipeline Group, Fortis Inc's acquisition of ITC Holdings – involved Canadian companies looking outside the country for growth. That often meant south of the border.
"Canadian investors are once again focused on the United States, and this will be an overarching theme in 2017," said Bruce Rothney, chief executive of Barclays Canada.
“The Trump presidency – and with it the promise of reforms in regulation, taxation and infrastructure spending – will accelerate activity in 2017/18," he said.
In the rankings, JPMorgan, Goldman Sachs and Bank of Montreal rounded out the top six. Among Canadian banks, RBC, BMO and CIBC were the top advisers. RBC also advised on the highest number of transactions.
A pickup in mining M&A and a steady stream of energy deals ensured that the resource sectors found their footing this year.
"In the low commodity price environment, we have seen some companies suffer and other companies on a relative basis gain advantage," said Dougal Macdonald, president of Morgan Stanley Canada.
"Those who have relative advantage have become consolidators and those who suffered have become targets," Macdonald added.
The energy sector benefited from deals in the midstream space.
“Notwithstanding the significant correction in oil prices over the last couple of years, energy M&A activity has held up pretty well,” said Peter Buzzi, co-head of Canadian M&A at RBC.
Large deals played an outsized role in helping boost deal growth, said Daniel Barclay, head of investment and corporate banking, Canada and international, at BMO Capital Markets.
BMO sees strong inbound and outbound activity in both the energy and mining sectors in 2017, Barclay said, adding that the Trump presidency could also create opportunities for deals.
Editing by Leslie Adler