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Large backlog of deals expected to create multi-year

transaction

stream

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Morgan Stanley ( MS ) sees growth in trading and wealth

management,

potential acquisitions possible

By Tatiana Bautzer

NEW YORK, Sept 10 (Reuters) - Morgan Stanley ( MS )

co-president Dan Simkowitz said on Tuesday there is "dramatic

improvement" on the deals outlook, not just compared with the

months where tariff volatility froze discussions, but

considering a longer period in the decade.

Simkowitz said at a banking conference that companies are

gaining confidence in reacting to deregulation policies, tax

cuts and potential interest rate cuts through the end of the

year.

The executive said that after three years of low activity in

capital markets and M&A, there is a large backlog of deals that

will create a multi-year stream of transactions.

Many companies' boardrooms are now considering strategic

movements as a reaction to new U.S. policies, Simkowitz added.

"Industrial policy in the United States is being restructured,

and that has impact on supply chains, where you want to put your

assets if you're a multinational company."

Financial sponsors are just beginning to monetize their

companies, not only because investors want part of their money

back, but also for compensation reasons - sales of portfolio

companies trigger compensation for the return to the private

equity executives.

Morgan Stanley ( MS ) estimates there are 1,500 private

equity-owned companies just in the United States worth at least

$1 billion. Pent-up demand will also help create a large stream

of deals that will go beyond 2026, Simkowitz added.

The reopening of the IPO market, according to the executive,

helps reduce the execution risk in M&A deals. Morgan Stanley ( MS ) led

the $1.37 billion IPO of Swedish fintech Klarna, that is set to

begin trading on Wednesday on the New York Stock Exchange.

Morgan Stanley's ( MS ) co-president added that the bank is seeing

big organic growth opportunities in the trading area, where it

has been gaining market share, and wealth management. But

Simkowitz did not rule out potential acquisitions in wealth and

asset management, although potential deals would have to clear a

high bar to be approved.

CEO Ted Pick had made similar comments about potential

acquisitions during the second-quarter earnings call. Pick's

predecessor James Gorman transformed Morgan Stanley ( MS ) through a

series of major purchases that turned it into a wealth

management powerhouse.