Mitsubishi UFJ to Buy Morgan Stanley Stake

Mitsubishi UFJ said it would buy 10% to 20% of Morgan Stanley for an undisclosed price.
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Updated from 9:22 a.m. EDT

Morgan Stanley

(MS) - Get Report

shares were up 3% Monday after Japan's

Mitsubishi UFJ

(MTU)

said that it would invest as much as 20% in the ailing investment bank.

In a company statement, Mitsubishi said it would acquire 10% to 20% of Morgan Stanley "as soon as practicable." The statement did not disclose a sale price of the stake, but said the agreement would allow it to appoint one director to Morgan Stanley's board.

Morgan Stanley had been talking with

Wachovia

(WB) - Get Report

about a possible merger last week, but those talks have since cooled, according to reports.

Cramer: Goldman, Morgan Better Off

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Mitsubishi last month scooped up the remaining 35% of

UnionBanCal

(UB)

it didn't already own for $3.5 billion.

Morgan Stanley shares were recently up 79 cents at $28. Earlier the stock had a double-digit gain before pulling back.

This article was written by a staff member of TheStreet.com.