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Friday, January 24, 2014

TAKEOVERCHATTER-As M&A business cools, banks warm to activist investors, (NYSE: MS)

Corporate raiders, long scorned by Wall Street, are gaining new credibility as activist investors, to the point that some investment banks are eager to bestow on them a new title: valued customer. Big Wall Street banks like Goldman Sachs and Morgan Stanley are still content to defend corporate America against investors like Carl Icahn and Dan Loeb, who take large stakes in companies with the hopes of effecting such changes as spinning off a division, cutting costs or ousting management.Protecting the corporate castle is profitable work, part of nearly $70 billion in corporate fees generated by investment banks annually, and big banks fear upsetting their best clients.Smaller investment banks, though, see a new source of revenue: Working with investors on one corporate campaign could help them win future assignments from another company, which may seek defensive services from banks familiar with the inner workings of activists.Getting involved in a merger-and-acquisition transaction is also opportune if the target company ultimately pursues a sale of itself under investor pressure.

Morgan Stanley is a global financial services company that, through its subsidiaries and affiliates, provides its products and services to a range of clients and customers, including corporations, governments, financial institutions and individuals. Shares of MS fell by 3.5% or $-1.103/share to $30.38. In the past year, the shares have traded as low as $20.16 and as high as $33.52. On average, 11475400 shares of MS exchange hands on a given day and today's volume is recorded at 14284624.