Deutsche Bank AG
) has sold its natural gas-trading books in North America to Morgan
). The divestiture comes as part of the bank's strategy to exit its
commodities-trading business due to declining profits and stricter
regulations. The transaction is also in line with the bank's goal
of gradually winding down its non-core businesses and focusing more
on enhancing shareholder value.
The news was first reported by Sparkspread, the real time energy
and trading news portal. The details of the deal, however, have not
Notably, Morgan Stanley bought Deutsche Bank's bulk commodities
trading books in coal, iron ore and freight forward contracts in
Jul 2014 (Read more:
Morgan Stanley Buys Deutsche Bank's Commodities
In the same month, Citigroup Inc. (
) took over the power-trading books of Deutsche Bank in order to
boost its energy trading business.
The latest move has come at a time when the physical commodities
business of many Wall Street banks, including Morgan Stanley has
been under an intense regulatory scrutiny. In June, Morgan Stanley
sold its TransMontaigne Inc. - an oil storage, marketing and
transportation company - to Tulsa, OK-based NGL Energy Partners LP
) for a cash consideration of $200 million (Read more:
Morgan Stanley Sells TransMontaigne Stake
). This deal indicated Morgan Stanley's aim of curtailing its
physical commodity business but the company stated that it would
continue trading in power and gas, oil and metals.
When all is said and done, the latest acquisition will augment
Morgan Stanley's customer base, making it a strong counterparty for
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