(Source: Business Wire)Morgan Stanley (NYSE: MS) today announced as part of a restructuring of its investment management division a definitive agreement to sell its retail asset management business, including Van Kampen Investments, Inc., to Invesco Ltd. (NYSE: IVZ), a leading independent global investment management company. This transaction allows the Firm to focus on its institutional client base -- including corporations, pension plans, large intermediaries, foundations and endowments, sovereign wealth funds, and central banks, among others.

Under the terms of the definitive agreement, Invesco will purchase Morgan Stanley's retail asset management business, operating under both the Morgan Stanley and Van Kampen brands, in a stock and cash transaction valued at $1.5 billion. Morgan Stanley will receive a 9.4 percent minority interest in Invesco, allowing the Firm to participate in the future growth of the combined Invesco and Morgan Stanley/Van Kampen businesses. The transaction, which has been approved by the Boards of Directors of both companies, is expected to close in mid-2010, subject to customary closing conditions and regulatory approvals.

James Gorman, Co-President of Morgan Stanley, said, "Our objective in Asset Management is straightforward: deliver superior performance for our clients, return our investment business to strong and consistent profitability, and reignite a best-in-class investment culture. This transaction is an important step in that direction. By taking a minority interest in Invesco, Morgan Stanley will be able to realize significant value in partnership with a world-class player.

"The combination of Invesco's strong and diversified product portfolio with Van Kampen's own product strengths and leading distribution capabilities will create a formidable new contender in the retail space

-- with the size and scale necessary to compete in today's rapidly changing and consolidating marketplace. In addition, this transaction will mitigate certain affiliated product sales restrictions faced by Van Kampen portfolio managers since the closing of the Morgan Stanley Smith Barney joint venture."

Going forward, Morgan Stanley Investment Management (MSIM) will be comprised of several distinct institutional-focused businesses. These include: a long-only institutional business (including equity and fixed income), a direct hedge fund business, a fund of funds business, a liquidity business, and a merchant banking business, including the Firm's real estate, private equity and infrastructure units.