By Devika Patel
Knoxville, Tenn., Oct. 13 - Morgan Stanley settled a $9 billion private placement of its 10% perpetual preferred stock with Mitsubishi UFJ Financial Group, Inc., according to a joint press release from the companies.
The deal was announced on Sept. 29 and was completed on very different terms from those with which it priced.
Under the revised terms of the transaction, Mitsubishi has acquired $7.8 billion of perpetual non-cumulative convertible preferred stock with a 10% dividend and a conversion price of $25.25 per share, and $1.2 billion of perpetual non-cumulative non-convertible preferred stock with a 10% dividend.
After one year, if the price of Morgan Stanley's common stock exceeds 150% of the conversion price for 20 or more out of 30 trading days, 50% of the preferred stock will be converted to common stock.
After two years, the remainder of the preferred stock will be converted to common stock under the same conditions.
The non-convertible preferred stock is callable after year three at 110% of the purchase price.
Under the original agreement, Mitsubishi was to have acquired 117 million common shares at $25.25 per share for $2.95 billion and perpetual preferred stock for $6.04 billion.
New York's Morgan Stanley is a global financial services firm that, through its subsidiaries and affiliates, provides its products and services to a group of clients and customers, including corporations, governments, financial institutions and individuals.
| Issuer: | Morgan Stanley
|
| Issue: | Perpetual non-cumulative convertible preferred stock, perpetual non-cumulative non-convertible preferred stock
|
| Amount: | $9 billion
|
| Warrants: | No
|
| Investor: | Mitsubishi UFJ Financial Group, Inc.
|
| Pricing date: | Sept. 29
|
| Settlement date: | Oct. 13
|
| Stock symbol: | NYSE: MS
|
| Stock price: | $24.75 at close Sept. 26
|
|
|
| Convertible preferreds
|
| Amount: | $7.8 billion
|
| Dividends: | 10%
|
| Conversion price: | $25.25
|
|
|
| Non-convertible preferreds
|
| Amount: | $1.2 billion
|
| Dividends: | 10%
|
| Calls: | After year three at 110%
|
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