Morgan Stanley

Morgan Stanley Investment Management Acquires Stake in Lansdowne Partners

Nov 1, 2006

Invests in Leading Hedge Fund Group with over $12 Billion in Assets Under Management as Part of Growth Strategy for Alternative Investments

London —

Morgan Stanley Investment Management (MSIM) announced today that it has acquired a 19% stake in Lansdowne Partners, a leading London-based investment manager. Lansdowne, founded by Paul Ruddock and Steven Heinz in 1998, has over $12 billion in assets under management.

"This investment fits well with the long-term growth strategy we have outlined for MSIM," said Owen Thomas, President and Chief Operating Officer of MSIM. "Following on from our recently announced transactions with Avenue Capital and FrontPoint Partners, it further demonstrates our commitment to build a market-leading alternatives business. As we continue developing our asset management franchise, we will continue to explore a wide range of opportunities that can bring innovative, high performance products and services to our clients."

"Lansdowne is consistently ranked as one of the best performing and most respected hedge funds in the world," said Stuart Bohart, Head of Alternative Investments at MSIM. "We are delighted to be an investor in Lansdowne, and look forward to continuing to build on our long-standing relationship."

About Lansdowne Partners

Lansdowne Partners manages assets valued at more than $12 billion across five different investment strategies: European Equity; UK Equity; Global Financials; Macro; and Emerging Markets. Founded in 1998, by Paul Ruddock and Steven Heinz, Lansdowne is based in London and has 79 employees, including 16 partners.

About Morgan Stanley Investment Management

Morgan Stanley Investment Management, together with its investment advisory affiliates, has over 400 investment professionals around the world and $448 billion in assets under management or supervision as of August 31, 2006. These entities offer investment management services to a diverse client base, which includes governments, institutions, corporations and individuals.

About Morgan Stanley

Morgan Stanley (NYSE: MS) is a leading global financial services firm providing a wide range of investment banking, securities, investment management, wealth management and credit services. The firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 600 offices in 30 countries. For further information about Morgan Stanley, please visit www.morganstanley.com.