Morgan Stanley Plans for Discover Spin-Off

WALL STREET -- Morgan Stanley, which announced plans to spin off its Discover Financial Services unit to shareholders in December, will issue one Discover share for every two Morgan Stanley shares held. Based on that ratio, Discover estimates there will be roughly 527 million Discover common shares, according to a filing with the Securities and Exchange Commission. Discover did not set a price range for the shares. Discover is the parent of PULSE EFT, the electronic funds transfer network serving 5,000 financial institutions, including 2,000 credit unions. In December, Morgan Stanley announced it would issue 100% of Discover stock to its shareholders in a tax-free spin-off that is expected to take place in the third quarter. Discover, which is joining cards competitor Visa USA in planned IPOs, hopes to imitate the success of last year’s IPO by MasterCard, in which the share price has almost tripled.