PULSE EFT to Go Public

WALL STREET – Morgan Stanley announced Friday it expects to complete the spin-off of Discover Financial Services, the nation's fourth-biggest credit-card network and the parent of PULSE EFT, on June 30 and shares will begin trading July 2. The network is one of the biggest payment systems in the nation and provides electronic funds services to more than 2,000 credit union. Investors will receive one Discover share for every two Morgan Stanley shares they own and Morgan Stanley will receive $100 million as part of the spin-off. The deal is Morgan Stanley's second attempt to split the credit-card unit, acquired in 1997 when the New York-based firm combined with Dean Witter Discover & Co. It acquired PULSE EFT, which was owned by more than 4,000 credit unions and banks, in 2005 and combined it with Discover. The market for payments systems is hot, with shares in MasterCard almost quadrupling in value since going public last May, and IPOs scheduled later this year for Visa USA and Metavante Corp., the Marshall & Ilsley unit that owns the NYCE network.