September 18th, 2008

HONG KONG – Wall Street dealmaking reached fever pitch, with Morgan Stanley holding preliminary sale talks, while other financial firms scrambled to find buyers as fear gripped markets, sending Asian stocks sharply lower.

With the financial landscape undergoing its most dramatic transformation since the Great Depression, potential takeovers lurked for No. 2 U.S. investment bank Morgan Stanley , weakened top U.S. savings bank Washington Mutual and major UK mortgage lender HBOS.

Panicked matchmaking followed the surprise $85 billion rescue of insurer American International Group by the U.S. Federal Reserve on Tuesday that did little to calm investors’ nerves. Read More.