Morgan Stanley to Sell Oil Unit to Rosneft

Morgan Stanley is about to hive off one of its commodities businesses. The financial services firm announced it has signed a definitive agreement to sell its global oil merchanting unit to a fully owned subsidiary of Russian energy giant Rosneft. The terms of the deal were not disclosed.

The unit being sold concentrates on the storage, trading, and transportation of petroleum and the products that are refined from it. The specific assets being transferred include a network of storage agreements, and a host of purchase, sale, supply, and shipping agreements. Morgan Stanley said around 100 employees located in the U.S., U.K., and Singapore will be transferred to Rosneft as part of the acquisition.

The transaction, which is subject to approval from the relevant regulatory bodies, is expected to close in the second half of next year. Morgan Stanley said the deal is not expected to have a material impact on its finances.

The news comes in the wake of a pronounced decline in commodities trading for the company. According to The Wall Street Journal, its revenue from the activity has fallen for five consecutive years. For 2013, total take is expected to be around $700 million, down sharply from almost $3 billion in 2008.

The article Morgan Stanley to Sell Oil Unit to Rosneft originally appeared on Fool.com.

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