Morgan Stanley to Sell Oil Unit to Rosneft

Morgan Stanley (NYSE: MS  ) is about to hive off one of its commodities businesses. The financial services firm announced it has signed a definitive agreement to sell its global oil merchanting unit to a fully owned subsidiary of Russian energy giant Rosneft. The terms of the deal were not disclosed.

The unit being sold concentrates on the storage, trading, and transportation of petroleum and the products that are refined from it. The specific assets being transferred include a network of storage agreements, and a host of purchase, sale, supply, and shipping agreements. Morgan Stanley said around 100 employees located in the U.S., U.K., and Singapore will be transferred to Rosneft as part of the acquisition.

The transaction, which is subject to approval from the relevant regulatory bodies, is expected to close in the second half of next year. Morgan Stanley said the deal is not expected to have a material impact on its finances.

The news comes in the wake of a pronounced decline in commodities trading for the company. According to The Wall Street Journal, its revenue from the activity has fallen for five consecutive years. For 2013, total take is expected to be around $700 million, down sharply from almost $3 billion in 2008.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2773591, ~/Articles/ArticleHandler.aspx, 4/21/2014 12:44:39 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...