Investment bank Morgan Stanley wants to sell Quilter, its UK-based wealth adviser with funds under management totalling £5.3bn (€7.8bn).

Quilter specialises at the lower end of the mass affluent high net worth market. James Gorman, the US bank's head of wealth, recently decided expansion outside the US should concentrate on clients worth more than $10m (€7.9m). Gorman has hired Alexander Classen from Goldman Sachs to take charge of his European division to develop this strategy. Former ABN Amro adviser Michael Markland is working on a Middle East initiative. However, Morgan's mass affluent operation will remain in the US, where it is well established. Morgan Stanley paid £172m for the former stockbroker Quilter Goodison in 2000. The investment bank had hoped to forge cross-selling opportunities but these became harder to develop as the bear market intensified. To this day, Quilter is viewed as a discrete unit within Morgan Stanley, which it is hoping to sell for £210m. An investment banker said: "Quilter has developed a strong identity under Martin Baines. It is classic buyout material." News of Quilter's sale coincides with speculation that Cazenove Capital Management, a UK wealth and fund management operation, will raise new capital. Sources close to Cazenove Capital denied the story. But one banker said its owners, the former broking partners of Cazenove, would need to decide whether to invest more capital, or sell, in due course. Since the summer, the owners of several fund management businesses have decided to reduce or sell their interests. US insurance group Marsh & McLennan has invited offers for Putnam Investments and Sun Life Financial wants to sell MFS. Commerzbank is considering the sale of Jupiter. Ashmore and BlueBay are mulling stock market floats.