Morgan Stanley to sell aircraft leasing; retain Discover unit

08/18/05 - newratings.com

NEW YORK, August 18 (newratings.com) – Morgan Stanley (MWD) Wednesday announced that it had decided to retain its Discover credit card unit despite pressure from shareholders to sell it. The company also announced plans to sell its aircraft leasing business.

John Mack, Morgan Stanley’s new chairman and chief executive, said that although the disposal of the aircraft leasing business would result in a $1 billion charge in the third quarter, it would boost the company’s profits and shareholder returns over time. The company intends to use the sale proceeds for the expansion of its securities businesses. Mack said Morgan Stanley has decided to not sell its Discover credit card business in view of the unit’s stable cash flows and robust growth opportunities. Discover has the potential to raise the company’s shareholder value in the near future, Mack added.