Davis Polk & Wardwell LLP is advising Morgan Stanley on its proposed joint venture with Mitsubishi UFJ Financial Group, Inc. that will integrate their securities operations in Japan. MUFG and Morgan Stanley, in a move that will allow them to leverage their respective strengths and networks, agreed to create two companies comprising their joint venture, Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. (MUMSS) and Morgan Stanley MUFG Securities Co., Ltd. (MSMS).
Under the terms of the definitive agreements, MUFG will contribute the wholesale and retail securities businesses conducted in Japan by its subsidiary Mitsubishi UFJ Securities Co., Ltd. into MUMSS. Morgan Stanley will contribute the investment banking operations conducted in Japan by its subsidiary, Morgan Stanley Japan Securities Co., Ltd. (MSJS), into MUMSS and will contribute the sales and trading and capital markets business conducted in Japan by MSJS into MSMS. Morgan Stanley will own a 40% economic interest and MUFG will own a 60% economic interest in the joint venture. Morgan Stanley will hold a 40% voting interest and MUFG will hold a 60% voting interest in MUMSS, while Morgan Stanley will hold a 51% voting interest and MUFG will have a 49% voting interest in MSMS. The transaction has been approved by the boards of directors of Morgan Stanley and MUFG and, subject to customary closing conditions, is expected to close on May 1, 2010.
The Davis Polk corporate team includes partners John D. Amorosi and William H. Aaronson, associates Mörk Murdock and Blake A. Smith (not yet admitted) and foreign temporary associate Hideaki R. Umetsu (admitted only in Japan), all of the New York office, and partners Eugene C. Gregor and Theodore A. Paradise of the Tokyo office. Partners Luigi L. De Ghenghi, counsel Reena Agrawal Sahni and associate Christine E. Graham are providing bank regulatory advice. Partner Scott W. Muller and associate Jonathan D. Martin of the New York office, and counsel William B. Hoffman and Margaret Ayres and associates Susan Hutner and Jeanine P. McGuinness of the Washington DC office are providing OFAC, anti-money laundering and anti-corruption advice. Counsel Gerard Citera and Robert L. Colby and associate David L. Portilla of the Washington DC office are providing broker-dealer regulatory advice. Partner Kyoko Takahashi Lin is providing benefits advice. Partner Nora M. Jordan and associate Gregory S. Rowland are providing investment management advice. Counsel Stephen M. Pepper is providing antitrust advice. Except as noted above, all members of the Davis Polk team are based in the New York office.
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