SHANGHAI, May 29 (Reuters) – Wall Street bank Morgan Stanley (MS.N: Quote, Profile, Research) plans to launch its first China fund venture next month in an effort to tap the country's booming wealth management market, people with direct knowledge of the matter said on Thursday.
Morgan Stanley had agreed to pay 40 million yuan ($5.77 million) for a 40 percent stake in Jutian Fund Management Co, based in Shenzhen, near Hong Kong, although the U.S. bank is waiting for China's Ministry of Commerce to approve its investment, said the sources.
In early May, Chinese securities regulators approved the deal. Jutian Fund would be renamed as Morgan Stanley Huaxin Fund Management Co, in which Shanghai-based China Fortune Securities Co, also known as Huaxin Securities, would take 30 percent for 30 million yuan.
Morgan Stanley is finalising its legal registrations of the new company, and such preparations and approval from the Ministry of Commerce are expected to be completed in the next few weeks, the sources said.
Morgan Stanley, the single largest shareholder of the fund venture, will have management control and the right to appoint senior executives of the company, which will still be based in Shenzhen, the sources said.
A Morgan Stanley spokeswoman declined to comment. ($1=6.935 Yuan) (Reporting by George Chen; Editing by Ken Wills)