Categories: world

Morgan Stanley – which is underwriting Uber's IPO – is denying reports that it marketed a short-selling product to lift investors – TechCrunch

Getting ready for the hailing wars According to a report earlier today from The Information, newly public lift threatened Morgan Stanley with legal action earlier this week, demanding in a letter that the powerful investment bank stop marketing a short-selling product that was believed to be trading in its stock. – the lead underwriter for Uber's IPO – had been calling pre-IPO investors in Lyft's offering and pitching them on a way to lock in gains, regardless of Lyft's lockup agreements with those investors. At first glance, it seems like the kind We have grown accustomed to seeing between the rival companies and their associates. But Morgan Stanley spokesman Mark Lake reports the New York Post report, which is the latest statement: “Morgan Stanley did not market or execute, directly or indirectly, a sale, short sale, hedge, swap, or transfer of risk or value associated with Lyft's stock for any Lyft shareholder identified by us to be the subject of a Lyft lock-up agreement. making, and any suggestion that Morgan Stanley engaged in applying short pressure to lifting is false. ” What went wrong is hard to know, given that the post shielded its sources. But it was highly descriptive in how it characterized the purported short-selling scheme. From its story: Driving the unusual bets is language in Lyft’s lock-up agreements that has hedge funds and other early lift investors giving themselves a green light to make limited short bets, which make money on a stock decline. The goal is…

Getting ready for the hailing wars

According to a report earlier today from The Information, newly public lift threatened Morgan Stanley with legal action earlier this week, demanding in a letter that the powerful investment bank stop marketing a short-selling product that was believed to be trading in its stock.

– the lead underwriter for Uber’s IPO – had been calling pre-IPO investors in Lyft’s offering and pitching them on a way to lock in gains, regardless of Lyft’s lockup agreements with those investors.

At first glance, it seems like the kind We have grown accustomed to seeing between the rival companies and their associates. But Morgan Stanley spokesman Mark Lake reports the New York Post report, which is the latest statement: “Morgan Stanley did not market or execute, directly or indirectly, a sale, short sale, hedge, swap, or transfer of risk or value associated with Lyft’s stock for any Lyft shareholder identified by us to be the subject of a Lyft lock-up agreement.

making, and any suggestion that Morgan Stanley engaged in applying short pressure to lifting is false. ”

What went wrong is hard to know, given that the post shielded its sources. But it was highly descriptive in how it characterized the purported short-selling scheme. From its story:

Driving the unusual bets is language in Lyft’s lock-up agreements that has hedge funds and other early lift investors giving themselves a green light to make limited short bets, which make money on a stock decline. The goal is to position the bets in which investors do not benefit from a decline in the stock, but simply to lock in their IPO gains, which were significant.

now, I’m going to do that, “said an investor.

” Lift made a mistake, “one investor who bought into the post. “People who own the stock are allowed to hedge their positions. You are not allowed to reduce your economic interest. ”

The investor was referring to a recent e-mail Lift sent to investors reminding them that they are not allowed to engage in any transactions that might affect a holder’s“ economic interest ”in the stock. This &#821

1; and other “lock-up” language around the IPO – has lifted investors against a decline in their stock holdings, rather than betting on the stock’s decline.

, which has yet to respond.

A source familiar with the situation confirms that Lyft’s ire with Morgan Stanley remains entirely on that piece, as noted in The Information. We’re told that no further action has been taken, beyond the letter sent to the bank by Lyft’s attorneys.

Whether the story ends here remains to be seen. The Information has updated its original post to include part of Morgan Stanley’s statement of denial, but it continues to report that, according to one of its sources, Morgan Stanley had been calling early Lyft investors for weeks during his roadshow and pitching them on a short Assuming Morgan Stanley is counting the truth – and we can’t imagine the bank would go on the record otherwise – there’s still the question of who floated misinformation about a short-selling product in the first place. It may be one that regulators want to get into. Stay tuned.

Share
Published by
Faela