Morgan Stanley Sets Price for China Deal
Posted on: Monday, 24 December 2007, 09:00 CST
SHANGHAI, China - Morgan Stanley and the Chinese government said Monday that the U.S. investment bank has determined the range of prices to be used when China's international investment fund converts $5 billion worth of securities into Morgan Stanley stock.
China Investment Corp. agreed last week to buy Morgan Stanley securities that will be convertible into up to 9.9 percent of the bank's stock in 2010, at a price of no more than 1.2 times the "reference price" that was confirmed Monday.
The reference price would be between $48.07 and $57.684.
Morgan Stanley's shares closed at $54.37 Friday, up 5.8 percent from their previous close.
The Chinese investment will help soften the blow from mortgage-related debt that led the bank to report a $9.4 billion writedown in the quarter ended Nov. 30.
Morgan Stanley, the second-largest U.S. investment bank by market value, reported a $3.6 billion net loss for the quarter, the first in the company's 73-year history.
Source: Associated Press/AP Online
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