Morgan Stanley said Monday, Nov. 9, it has agreed to buy Vinyl Equity, a fintech that digitizes the transfer of shares between companies and their shareholders, as the bank pushes deeper into serving private companies before they go public.
Terms were not disclosed. The deal is expected to close in the first quarter of 2027, Banking Dive reported. A Morgan Stanley spokesperson told Bloomberg the integration would cost $65 million over a couple of years.
Why it matters
The deal gives Morgan Stanley its own transfer agent, so it won't need a third party to manage cap tables, equity administration or share transfers when a company goes public. Morgan Stanley already handles administration for more than 1,000 private companies, nearly 70% of existing unicorns, according to Scott Whatley, head of Morgan Stanley at Work, Yahoo Finance reported. IPO-related stock flows made up more than half of the $380 billion in net new assets its wealth division brought in over the second and third quarters.
"Private markets are playing an increasingly important role in wealth management as companies stay private for longer," said Jed Finn, head of Morgan Stanley Wealth Management. Whatley said Vinyl's cloud platform already supports tokenization, which records share ownership on a blockchain, though he said how that market and its rules evolve is uncertain.
About Vinyl
Vinyl was founded in 2022 and raised a $20 million Series A this year. It will join Morgan Stanley at Work, which follows the bank's purchase of private-share marketplace EquityZen in January. Related: Stocks rally Monday.