Morgan Stanley Investment Management Launches Morgan Stanley Emerging Markets Domestic Debt Fund, Inc.
Morgan Stanley Investment Management (“MSIM”) announced today that it has launched Morgan Stanley Emerging Markets Domestic Debt Fund, Inc., the first U.S. registered closed-end fund to invest principally in emerging markets sovereign debt denominated in the local currency of the issuer. The Fund has issued 63.75 million shares of its common stock at a price of $20 per share for a total of approximately $1,275,000,000 (before deduction of the sales load and offering expenses and exclusive of the underwriters’ over-allotment). Assuming full exercise of the underwriters’ over-allotment, the proceeds to the Fund (before deduction of the sales load and offering expenses) could be increased to approximately $1,466,250,000. The subscription period for the Fund’s initial offering ran from March 26, 2007 through April 23, 2007.
The Fund’s shares now trade on the New York Stock Exchange under the symbol “EDD.” The Fund’s lead underwriter was Morgan Stanley & Co. Incorporated and the co-managers were A.G. Edwards, Oppenheimer & Co. and Raymond James.
“Morgan Stanley Emerging Markets Domestic Debt Fund, Inc. is another example of our commitment to providing sophisticated and innovative strategies that leverage our experience as one of the world’s leading institutional money managers,” said Owen Thomas, President of Morgan Stanley Investment Management. “More than ever, we’re working across borders and asset classes to develop new forms of investment opportunities for our clients.”
Distributed by the Firm’s Global Wealth Management Division, this unique closed-end fund gives U.S. investors dedicated access to an asset class that traditionally has not been readily available to individual investors. The Fund will invest primarily in sovereign debt obligations but may also invest in debt obligations of non-governmental issuers located in emerging markets, including bonds, convertible securities and commercial paper.
“This is a very good example of the kind of opportunity - drawing upon the full depth of intellectual capital available at Morgan Stanley - that we want to bring to our clients,” said James Gorman, President and Chief Operating Officer of Morgan Stanley Global Wealth Management. “Innovative investment products such as this fund help fulfill the potential of a Morgan Stanley relationship"
The Fund is managed by MSIM’s Emerging Markets Debt team, which has been managing money in the emerging debt markets since 1993. Team members Abigail McKenna, CFA, Eric Baurmeister, CFA, and Federico Kaune, Ph.D., have nearly 50 years of combined investing experience and are supported by MSIM’s broader emerging markets team, pooling the resources of emerging markets equity and debt teams in Singapore, Mumbai and New York. MSIM believes its global network of resources is a competitive advantage for uncovering opportunities in emerging markets around the world.
“The growth of local currency emerging market domestic debt represents the next phase of development for emerging markets economies and offers a diversification option for U.S.-based investors,” said Abigail McKenna, Managing Director and a Portfolio Manager for the Fund. “The Emerging Markets Domestic Debt Fund provides exposure to improving emerging market fundamentals through investments in a regionally diversified group of sovereign government bonds denominated in a diversified basket of emerging market currencies.”
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