Morgan Stanley to sell stake in MSCI unit

1 August 2007

Morgan Stanley is planning to sell an undisclosed stake in its MSCI subsidiary in an initial public offering.

The investment bank registered its intention to sell the unit, which manages stock indexes, with the US Securities and Exchange Commission yesterday.

It is hoped that the IPO will raise $200 million for the firm and will enable it to concentrate on its securities business.

Morgan Stanley chief executive and chairman John Mack said: "The initial public offering and potential separation of MSCI are consistent with Morgan Stanley's strategy to focus our people, capital and resources on our core businesses, including institutional securities, asset management and global wealth management.

"We believe this transaction will unlock value for Morgan Stanley's shareholders as well as release capital to redeploy into our core activities."

Analysts predict that the sale will equate to ten per cent of Morgan Stanley's shareholding in MSCI.

The unit has over 2,800 clients worldwide and posted revenue of $311 million in 2006.

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