Morgan Stanley, the US investment bank, is to pay $816.4m (€675.9m) to buy Barra, the risk measurement company which will be combined with Morgan Stanley Capital International, the bank's majority-owned benchmark unit.

The bank will buy the Berkeley, California-based business for $41 per share in cash, a 9% premium over Barra's closing price on Monday. It will then own one of the most successful risk measurement agencies which has become the industry standard among fund management firms worldwide.