Morgan Stanley ( MS) is in discussions to acquire investment management firm FrontPoint Partners LLC, which caters to alternative investments and hedge funds, the Wall Street Journal reports.

The Greenwich, Conn.-based firm, which has $5.8 billion in assets, could go for as much as $300 million, the Journal says.

John Mack, the New York brokerage firm's chairman and chief executive, has been looking to bolster Morgan Stanley's alternative-investment platform, including hedge funds and private equity buyouts. Last Thursday, the company announced that it had hired Stephen Trevor from Goldman Sachs ( GS) and appointed its own head of corporate finance, Alan Jones, to become co-heads of its newly established private equity business.

Morgan Stanley had been in talks with FrontPoint over last year, but at the time, its price tag of $1 billion was above what Mack wanted to pay.

Under the new deal's terms, FrontPoint's chairman Philip Duff would become a consultant to Morgan Stanley on strategic issues, however, he wouldn't join as a senior executive.

Spokeswomen for Morgan Stanley and FrontPoint decline to comment on Thursday.