Morgan Stanley in second bid to exit historic China venture
Thursday, November 05, 2009
Morgan Stanley is soliciting bids for its stake in China International Capital Corp, said three people familiar with the matter.
Potential bidders for the 34.3 percent holding in CICC, the first Sino-foreign investment bank, include US private-equity firms.
The stake could be worth US$1 billion (HK$7.8 billion), according to one of the insiders.
It is the second attempt by Morgan Stanley to dispose of its stake in CICC, formed in 1995, after talks with buyout firms fell apart early last year on disagreements over valuation.
Morgan Stanley chairman John Mack is seeking to sell the CICC investment to build a brokerage in the mainland that it controls.
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"Morgan Stanley wants to sell CICC because it can't control the business and they would prefer a smaller securities firm they can exert management influence over," said Wei Tao, a banking analyst at China Securities in Beijing. Morgan Stanley invested US$35 million in CICC when it was established in 1995.
The New York-based bank ceded management control in 2000 and CICC is now run by Levin Zhu, the son of former premier Zhu Rongji.
Morgan Stanley last year talked with TPG, CV Starr and JC Flowers about potential bids for the CICC stake. BLOOMBERG
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