Morgan Stanley is negotiating with the Chinese government for a fresh infusion of funds into the beleaguered investment bank, CNBC reported late Wednesday. The report follows an earlier report in the NYT that Morgan Stanley had been approached by Wachovia Bank about a potential deal. The investment bank’s CEO John Mack held various conversations with potential merger partners Wednesday afternoon including top executives at Citigroup and Wachovia Bank. While Mack continues to work to keep Morgan Stanley independent, some sort of a deal becomes more likely as the investment bank’s stock - which plunged more than 24% Wednesday - declines further, CNBC added. Executives at Morgan are currently crunching numbers to determine how much of an additional minority stake they need to sell to settle market fears about the firm’s health. Mack’s plan is to sell a piece of Morgan Stanley to a Chinese bank and he was dealing with Chinese officials throughout Wednesday to line up money. CNBC earlier reported that UK bank HSBC is also among possible buyers of Morgan Stanley.
