Visa exchange would be advantageous for holders, says Morgan Stanley

After Visa announced that it’s engaging with common stockholders regarding potential amendments to its certificate of incorporation that, together with a potential exchange offer program, would release transfer restrictions on portions of Visa’s Class B shares, Morgan Stanley analyst James Faucette said based on the structuring of the potential exchange offer, the firm agrees with Visa management’s commentary that the exchange would be advantageous for holders of Visa’s Class A, B, and C shares. For Class A and C shareholders, the exchange would reduce the overhang related to the uncertainty of when and how Class B shares eventually become converted and publicly tradeable, while for Class B shareholders, namely banks, the exchange will allow for more liquidity and a clear path for exchanging shares, the analyst tells investors. Morgan Stanley has an Overweight rating and $292 price target on Visa shares.