Wei to go for Morgan Stanley's China IB business?

Are China''s leading rainmakers engaging in another round of musical chairs?

Morgan Stanley's China investment banking team is said to be undergoing a major upheaval following rumours that its current CEO Jonathan Zhu decided to leave the US investment bank late last week. Zhu is said to be heading to Bain Capital where he will head the Boston-based private equity firm's China operations.

Zhu has long been one of Morgan Stanley's most highly rated bankers having amassed 10 years experience bringing Chinese companies to the international capital markets. If confirmed, his departure will propel yet another senior investment banker down an increasingly well trodden path into the world of private equity.

Last year, for example, Goldman Sachs lost two of its most senior investment bankers in the region to private equity firms. Rajiv Ghatalia, the US investment bank's co-head of Asian investment banking, joined Warburg Pincus, while its TMT head Frank Tang joined Temasek.

In Zhu's place, it is strongly rumoured that the firm's new global chairman and CEO, John Mack, has offered the China CEO role to his old friend Wei Christianson - currently CEO of China investment banking at Citigroup. Both Citigroup and Morgan Stanley declined to comment on whether either executive has resigned from their respective firms.

Job hopping is particularly prevalent at this time of year following the payment of annual investment banking bonuses. Morgan Stanley and Goldman Sachs typically lead the industry by settling bonus payments in mid-December. Citigroup bonuses are paid out at the end of January.

Should Christianson take up a job at Morgan Stanley it will come as no great surprise to many in the industry. She has been a close friend of Mack since the early part of the decade when they both first worked together at Morgan Stanley.

Mack was then global President and CEO of the US investment bank, while Christianson was a Beijing-based VP. She is said to have accompanied Mack to many of his client meetings on the Mainland and the two developed a close rapport.

When Mack became CEO of Credit Suisse First Boston in July 2001, he lured Christianson over soon after. In January 2002 she enjoyed a meteoric career rise by being appointed head of CSFB's China operations.

She decided to leave in June 2004 when Mack was ousted from CSFB and a few months later re-surfaced at Citigroup. She joined the latter in September 2004, just over a month after another former close colleague, Stephen Volk, was appointed a vice chairman of investment banking.

Volk is also a longstanding friend of Mack's. A lawyer by training, he helped advise Morgan Stanley on the Dean Witter merger and was later hired by Mack to be his IB chairman at CSFB. When Mack left, so did Volk.

So too, Christianson is a lawyer by training. She was among the first wave of Chinese graduates to head to the US to finish their education - gaining a law degree from Columbia.

Like many of her contemporaries she then returned to China in the early 1990's as the country's economic growth began to explode. She joined Bank of America in the mid 1990's after a few years at Hong Kong's SFC where she was instrumental in drafting regulations for Chinese issuers.

During her tenure at CSFB, the firm executed key IPO mandates for China Life and SMIC. Mack himself was said to have been instrumental in securing both deals and was back in Beijing again last week pitching to win ICBC's IPO for Morgan Stanley before heading down to Hong Kong.

Should Christianson join Citi, many believe her relationship with Mack will provide one of her best calling cards with Chinese clients. The US investment banker has long been one of the country's biggest supporters and has built up an incredible cachet on the mainland.

Christianson's own roster of clients includes Sinotrans, which is hoping to IPO its dry bulk operations during the first half of 2006 via Citigroup. The transportation group initially listed its logistics arm via CSFB in 2003.

Two months after Christianson joined Citi, the latter executed a $1 billion plus IPO for China Netcom, but had a relatively quiet year in China during 2005 after it lost a bookrunner's position on CCB to CSFB. The bank's big China deal of the year was CNPC's $4.18 billion acquisition of PetroKazakstan, an advisory mandate said to have been won by Citigroup's influential Asian IB chairman Francis Leung.

Zhu meanwhile also has a long list of deals to his name and if he is leaving it will be on the high. Last year was the bank's best ever in China thanks to its completion of a $9.23 billion IPO for China Construction Bank, the world's biggest IPO in five years.

Bain, on the other hand, has recently gained prominence in China after putting in a $1 billion bid for US appliance manufacturer Maytag last summer in alliance with Haier and the Blackstone group.