Morgan Stanley Looking to Avoid Lehman Fate with Talk of Merger
Reports are buzzing about on Wall Street that Morgan Stanley officials are weighing whether the firm should remain independent or merge with a bank given the recent turbulence in the company's stock.
As of late Tuesday Morgan officials were not in merger discussions, according to people close to the matter. But senior people at Morgan concede that further zig-zags in the company's stock price could and possibly will force the company to change course and seek a merger partner, probably a well capitalized bank.
Morgan Stanley CEO John Mack wants to avoid the mistake made by Lehman Brothers CEO Richard Fuld, who brushed aside buyout offers until the market crushed shares of the firm and force it into bankruptcy.
Morgan, analysts say, has a stronger balance sheet than Lehman and recently pre-announced financial results showing profits for the third quarter, and a lower than expected decline of 7.7 percent from the third quarter of last year.
Published on September 17, 2008
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