Morgan Stanley Makes $1.75 billion UK Credit Card Acquisition

Morgan Stanley today announced that it has entered into a definitive agreement to acquire the Goldfish credit card business (“Goldfish”) from Lloyds TSB for a price of around £1 billion ($1.75 billion), a premium of £175 million of net receivables. The transaction is expected to complete in the middle of February 2006.

The acquisition of Goldfish will significantly build on Morgan Stanley’s existing UK credit card business, which has successfully grown to over 1.5 million accounts. The Goldfish brand adds a further 800,000 accounts to the Morgan Stanley base, an increase of 47%. Receivables will increase by £0.8 billion from approximately £1.5 billion to £2.3 billion. The acquisition will also include Goldfish’s Glasgow Operations Centre staff and premises. Morgan Stanley currently has over 700 employees in its UK credit card operation.

Sir David Walker, Chairman of Morgan Stanley International, commented: “This acquisition is consistent with Morgan Stanley’s stated strategy of growing our international business by taking opportunities for bolt-on acquisitions and further underscores our increasing resource commitment to the UK and Europe.”

Charlotte Hogg, Managing Director of Morgan Stanley’s UK credit card business, added: “We are very pleased to be acquiring Goldfish. The acquisition will give Morgan Stanley the opportunity to invest in the Goldfish brand and strengthen its foothold in the credit card market, while continuing to grow in the rewards space. Through this transaction we will be reaffirming our commitment to employment in Scotland, and look forward to welcoming Goldfish employees to Morgan Stanley.”

Morgan Stanley has selected the Goldfish brand as one that is a great fit for the company and its products. The Goldfish brand complements the existing card portfolio and adds a new arm to the credit card business.

Morgan Stanley is a global financial services firm and a market leader in securities, investment management and credit services. With more than 600 offices in 28 countries, Morgan Stanley connects people, ideas and capital to help clients achieve their financial aspirations.

Morgan Stanley is one of the world’s largest providers of credit cards with more than 50 million cardholders globally, mainly in the US through the Discover Card issued on the Discover network.