After almost three years in the region as co-head of ECM, John Daly's Irish eyes will no longer be smiling on Asia. The Goldman Sachs banker will leave the region in less than a fortnight, and will transfer to New York ECM to run the industrial and natural resources industry sector group. This is one of the four sector groups Goldman has in New York (FIG, TMT, healthcare/retail being the others). The industrial and natural resources sector is the largest of the four.
Daly will be sadly missed (even by some of his competitors) as he is one of the most down-to-earth and straightforward bankers working in ECM. Colleagues also say he is an excellent motivator and great team manager. Together with co-head Mark Machin, Daly has built an ECM team that has won numerous awards over the past few years, not least FinanceAsia's Equity House of the Year for 2002.
Here he talks to FinanceAsia about his time in Asia:
The Asian markets are now doing better, will you be replaced?
Daly: No. Mark and myself have been co-heads for the last three years, and Mark will assume sole leadership now. Mark has been in capital markets for 10 years, and nine of those have been in Asia. He's the longest serving ECM professional currently in the region.
With your departure, does that mean Goldman is going to be under-resourced in Asian ECM?
No, I think we are appropriately-sized for the opportunity.
Looking back on your time in Asia, what are you most proud of?
The team, I would say. Your last question suggests we need someone to come out because I am going to New York, but one of the things I'm most happy about is that we have an incredibly strong team in equity capital markets (ECM).
What have been the highlights of your time in Asia?
The three years I've been in Asia have been a remarkable three years. They have been the highlight of the 14 years I've been at the firm. The things that make Asia great are the diversity of the transactions and the diversity of the clients. Almost every deal is vitally important both to the client and the market and almost every transaction is industry-defining. A badly executed transaction can have a huge impact on a particular country for a substantial period of time. So the importance of each deal to the client and the market itself makes Asia very special.
Secondly, I would say that when I came out here we had a great franchise, but we were probably less good in Korea and Australia. Over the last couple of years we've significantly improved our standing to a market leading position in those markets, as well as maintained our strong franchise in the other markets. I feel proud that up until recently, Goldman Sachs had been a bookrunner of every equity and equity-linked transaction out of Korea (over $50 million) for the previous one-and-a-half year period.
Is there a particular transaction that sticks in the mind?
The transactions I've worked on have been all over the map. From smaller deals like the $50 million Ambit trade, to the billion dollar plus trades like TSMC and SK Telecom. TSMC in January 2002 was a billion dollar transaction where the stock outperformed its comparables, was priced at a small discount and traded up in the aftermarket. That sticks in the mind.
Kookmin, a $700 million deal from last June, also sticks in the brain. For the same reason, SK Telecom. For all transactions, we measure ourselves by the quality of our execution and always aim to price at tight discounts for issuers, while achieving good aftermarket performance for investors. I feel we've consistently achieved that over the last couple of years.
Earlier in the year, during SARS we talked about the market's deal pipeline, which then looked fairly bleak. Have things dramatically improved and are you more bullish on Asia today?
I'm really optimistic. This year has really been about one quarter, because there was so little issuance during SARS and the Iraq war. In the May-June-July period there has been a lot done. Our largest deals were the $1.2 billion Promina transaction, $1.6 billion Chunghwa Telecom transaction and $900 million plus TSMC transaction. In fact, during this period we executed almost as many deals as we did over the whole of last year. When I look at the pipeline that we have and our competitors have, I am incredibly optimistic about the region.
Any last thoughts?
It's been a marvelous three years. Asia is now a part of me and I believe it always will be.