New Issue: Morgan Stanley sells $2.39 million 17% RevCons linked to Disney

By Susanna Moon

Chicago, Jan. 27 - Morgan Stanley priced $2.39 million of 17% annualized reverse convertible securities due July 28, 2009 linked to the common stock of Walt Disney Co., according to an FWP filing with the Securities and Exchange Commission.

Interest is payable monthly.

Payout at maturity will be par unless Disney stock falls below the trigger price - 70% of the initial share price - during the life of the notes and finishes below the initial share price, in which case the payout will be a number of Disney shares equal to $1,000 divided by the initial share price or, at Morgan Stanley's option, the value of those shares in cash.

Morgan Stanley & Co. Inc. is the agent.

Issuer:	Morgan Stanley
Issue:	Reverse convertible securities
Underlying stock:	Walt Disney Co. (Symbol: DIS)
Amount:	$2,386,000
Maturity:	July 28, 2009
Coupon:	17%, payable monthly
Price:	Par
Payout at maturity:	If the stock falls below trigger price during life of notes and final share price is less than initial share price, 48.52014 Disney shares or equivalent cash value; otherwise, par
Initial share price:	$20.61
Trigger price:	$14.427, or 70% of initial share price
Pricing date:	Jan. 23
Settlement date:	Jan. 28
Agent:	Morgan Stanley & Co. Inc.
Fees:	1.5%

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