Morgan Stanley announced plans to build a new private equity business within its asset management division today.

The bulge bracket firm reported that Stephen Trevor and Alan Jones will become co-heads of the newly established private equity business within Morgan Stanley Investment Management. Trevor will join the firm from Goldman Sachs in March 2007, where he is a managing director in the principal investment area. Jones is currently head of Morgan Stanley’s corporate finance department.

Trevor and Jones will be responsible for building and leading the firm’s private equity business for third-party investors. They will focus on direct investments, joint ventures, leveraged buyouts and fund investments and will oversee the firm’s infrastructure business as well. They will report to Owen Thomas, president and COO of MSIM.

John Mack, chairman and CEO of Morgan Stanley, said, “Steve Trevor and Alan Jones are a perfect team to lead our private equity initiatives. Steve Trevor is a world-class banker and leader with extensive private equity experience, having worked in the principal investment business in Hong Kong, Europe and, most
recently, New York. Alan Jones is one of Morgan Stanley’s most talented and influential bankers and has worked with financial sponsors for most of his 20-year career. His deep knowledge of Morgan Stanley’s platform and his strong relationships in the private equity community will prove invaluable as we look to build our own private equity business.”

“As we move to grow our private equity business, we are assembling a team of top talent from both inside and outside the firm, and we are extremely pleased that these two very experienced executives will be
leading our efforts,” said Robert Scully, co-president of Morgan Stanley. “Morgan Stanley’s bankers offer unparalleled capabilities for sourcing investment opportunities, and our new private equity team will work to create investment funds that can leverage those opportunities and allow us to co-invest alongside our clients.”

Thomas said, “As we accelerate our private equity initiatives, our private equity team will utilize the full resources and capabilities of our firm to create industry-leading private equity products for the investors we serve.”

Trevor, 43, has been based in New York since 2004, primarily focusing on industrial investing for Goldman Sachs’ Principal Investment area. From 1999 to 2004, he was based in London and led Goldman Sachs Capital Partners’ investing activities in Germany. He joined Goldman Sachs in 1992 and previously worked in Hong Kong in the firm’s Investment Banking and Real Estate Principal Investment areas.

Jones, 45, has been with Morgan Stanley since 1993. He is a managing director and has been head of the corporate finance department since 2005.