Morgan Stanley’s shortlist of bidders for its 34.3% stake in China International Capital Corporation (CICC) includes American private-equity firms Bain Capital, Carlyle Group, General Atlantic, Kohlberg Kravis Roberts and TPG, and Taiwan’s Fubon Investment Bank, the Wall Street Journal reported. Fubon Investment Bank’s place on the list is considered surprising given the senstive nature of cross-strait investments in financial institutions. Morgan Stanley must sell off its passive stake in CICC before it is permitted to form a new domestic securities joint venture. The deal is complicated by sovereign wealth fund China Investment Corp’s (CIC) position as CICC’s largest shareholder, and the influence of CICC head Levin Zhu, son of former premier Zhu Rongji; the support of both CIC and Levin Zhu will be important in the success of any agreement. Furthermore, Morgan Stanley’s 34.3% share would be diluted to 27.4% if phantom shares, which provide an economic stake in the company but no voting power or board representation, were converted to ordinary shares.