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Morgan Stanley ploy: divorce CICC, marry China Forture
By Winny Wang |
October 19, 2010, Tuesday
|
Online Edition
Online Edition
MORGAN Stanley has reportedly won approval from Chinese regulators to sell its 34.3 percent stake in investment bank China International Capital Corp.
The sale will pave the way for the bank to set up a new investment banking joint venture with China Fortune Securities Co after it exits CICC.
Involved regulators have agreed the New York-based company to exit from the Chinese investment bank but they still need to make a procedural review by the end of this month, before granting official approval, the Shanghai Securities News reported today without citing any sources.
A Morgan Stanley official told Shanghai Daily today that he "was not clear" about the issue so far.
Morgan Stanley was also said to have talks with private equity firms KKR and TPG about selling its stake in CICC for more than US$1 billion, according to earlier media reports.
Morgan Stanley has been seeking to sell the CICC stake for more than two years, and it signed a memorandum of understanding with Shanghai-based China Fortune at the end of 2007 for the joint venture.
In China, a foreign company is only allowed to set up one investment banking joint venture, which means Morgan Stanley has to sell its stake in CICC in order to form another company with China Fortune, in which the New York bank is expected to have more say in management.
Morgan Stanley invested US$37 million to form CICC with China Construction Bank Corp in 1995.
The sale will pave the way for the bank to set up a new investment banking joint venture with China Fortune Securities Co after it exits CICC.
Involved regulators have agreed the New York-based company to exit from the Chinese investment bank but they still need to make a procedural review by the end of this month, before granting official approval, the Shanghai Securities News reported today without citing any sources.
A Morgan Stanley official told Shanghai Daily today that he "was not clear" about the issue so far.
Morgan Stanley was also said to have talks with private equity firms KKR and TPG about selling its stake in CICC for more than US$1 billion, according to earlier media reports.
Morgan Stanley has been seeking to sell the CICC stake for more than two years, and it signed a memorandum of understanding with Shanghai-based China Fortune at the end of 2007 for the joint venture.
In China, a foreign company is only allowed to set up one investment banking joint venture, which means Morgan Stanley has to sell its stake in CICC in order to form another company with China Fortune, in which the New York bank is expected to have more say in management.
Morgan Stanley invested US$37 million to form CICC with China Construction Bank Corp in 1995.
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