Mitsubishi UFJ Financial Group (MUFG) to invest US$9 billion in Morgan Stanley

September 29, 2008- Mitsubishi UFJ Financial Group, Inc., (President & CEO Nobuo Kuroyanagi, “MUFG”) and Morgan Stanley (Chairman and CEO John J. Mack) announced that they have completed a final agreement to enter into a strategic capital alliance, subject to the approval of the relevant authorities. The agreement follows discussions between the two banks on developing a strategic cooperative relationship, and is based on their agreement of September 22, 2008. The details are as follows.

Purpose

MUFG and Morgan Stanley have entered into a capital alliance aiming to build a global strategic alliance primarily in the corporate and investment banking fields.

Morgan Stanley has a network of over 600 branches in 35 countries providing a range of services for corporations and individuals to governments and institutions. Morgan Stanley has businesses providing comprehensive financial services including investment banking, securities, investment management and wealth management services and is positioned as a global market leader in businesses ranging from securities underwriting and subscription, M&A and other advisory services, trading and other services to its investment banking business.

MUFG and Morgan Stanley, as strategic partners, have agreed to explore a global alliance strategy in corporate and investment banking, retail, investment management, and other businesses, and in order to maximize the effectiveness of the alliance are targeting a concrete strategy by June 30, 2009.



2. Details of the alliance

MUFG will acquire 21% of the voting rights of Morgan Stanley on a fully diluted basis for US$9 billion. The investment will take the following form: MUFG will acquire common stock valued at about US$3 billion (at US$25.25 per share), and perpetual preferred stock convertible to common stock (at a conversion price of US$31.25 per share) valued at about US$6 billion.

MUFG will have the right to maintain a 20% investment ratio in Morgan Stanley, and, as long as MUFG holds an investment ratio of 10% or more in Morgan Stanley, MUFG will have the right to appoint one director to its board.

(This is press release of MUFG & Morgan Stanley)

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