Morgan Stanley – who is underwriting Uber's IPO – denies reports it marketed a short-term product to Lift Investors – TechCrunch

It is just broken out there again in the raging war.

According to a report from The Information, the new public lift Morgan Stanley threatened court action earlier this week, demanding in a letter that a heavy investment bank stop marketing a short-term product that it believed was disturbing stock trading.

It says Lyft learned about the product through the New York Post, which reported in its own separate story early this week that Morgan Stanley – The leading guarantor of Uber's IPO – had called before investors in Lyft's offer and pitching them on a way to lock in winnings, no matter what the lift's lockup deals with the investors.

It sounds like the dirty pool we & # 39; have become accustomed to seeing between competitors and their employees. But Morgan Stanley spokesman Mark Lake tells TechCrunch that the New York Post report was inaccurate and gave us the following statement: "Morgan Stanley did not market or execute directly or indirectly a sale, short sale, hedge, exchange, or transfer of risk or value associated with to Lyft's share for any Lift Shareholder identified by the Company or otherwise known to us to be subject to a Lock Agreement.

"Our company's business has been in the normal market making and any suggestion that Morgan Stanley Engaged in an attempt to apply a short pressure to Lyft is false. "

What was difficult to know was that Posten shielded its sources, but it was very descriptive in how it characterized the alleged short-term scheme. From its history:

Driving the unusual games is language in Lyft's lock agreements as have hedge funds and other early lift investors who give a green light to create limited "short" games, making money from the stock's decline, the goal being to place the bets in such a way that investors do not benefit from a decline or Increase in stocks, but only to unlock their IPO gains, which were significant.

"If I can lock at $ 70 now, I'll do it," an investor said.

"Lift a mistake," said an investor who bought into the Lift shares before the IPO. "People who own the shares are allowed to secure their positions. You are not allowed to reduce your financial interest. "

The investor referred to a recent e-mail sent to investors and reminds them that they are not allowed to engage in transactions that may affect the holder's financial interest in the share. "The language around the IPO ̵[ads1]1; instead of betting on the stock's decline, Lyft investors protect against a drop in an amount identical to their stock holdings.

We've come out to Lyft for comment, which hasn't yet

A source familiar with the situation confirms that Lyft & rsquo; s ire with Morgan Stanley rests entirely on that record, as mentioned in the information, and we are told that no further action has been taken beyond the letter sent to the bank by Lyft's attorneys.

If the story ends here, it remains to be seen. The information has updated its original post to include part of the Morgan Stanley's denial statement, but it continues to report that Morgan Stanley in Following one of its sources had called early lift investors for several weeks under the road show and pitched them on short-selling transactions that would allow them to lock in winnings regardless of the lock.

Assuming Morgan Stanley tells the truth – and we can't imagine that the bank would go on the record otherwise – there is still the question of who ran the Wrong Information about a Sword product in the first place. It can be one that regulators want to dig into. Stay tuned.