Morgan Stanley has agreed to purchase mutual-fund company Van Kampen for $745 million in cash, plus the assumption of $430 million in debt, The Wall Street Journal reported Monday.
Depending on how much debt Van Kampen/American Capital pays off, Morgan Stanley may have to pay even more cash to leveraged-buyout firm Clayton Dubilier & Ripe Inc. to close the deal, The Journal reported.The acquisition would boost the securities firm's assets under management to $157.3 billion from $100 billion currently, catapulting Morgan Stanley in the ranks of Wall Street money managers to just behind industry leader Merrill Lynch & Co.
It would also give Morgan Stanley a toehold in the fast-growing mutual-fund business, the newspaper said.
The deal could be announced as early as Monday. Van Kampen is based in Oakbrook Terrace, Ill.
Officials at Morgan Stanley, Clayton Dubilier, Van Kampen, and Merrill Lynch all declined to comment, the Journal said.