PROSPECTUS Dated May 1, 1996 Pricing Supplement No. 2 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-01655
Dated May 1, 1996 May 10, 1996
Rule 424(b)(3)
Morgan Stanley Group Inc.
MEDIUM-TERM NOTES, SERIES C
Senior Variable Rate Renewable Notes
The Senior Variable Rate Renewable Notes described in this Pricing
Supplement (the "Renewable Notes") will mature on the Initial Maturity Date,
unless the maturity of all or any portion of the principal amount thereof is
extended in accordance with the procedures described below. On the calendar
day following an Election Date (as defined herein), the maturity of the
Renewable Notes will be extended to the date occurring 366 calendar days from
and including the 15th day of the next succeeding month unless the holder
thereof elects to terminate such automatic extension; provided, however, that
if such 366th calendar day is not a Business Day, the maturity of the
Renewable Notes will be extended to the immediately preceding Business Day.
The holder may terminate the automatic extension of the maturity of the
Renewable Notes or of any portion thereof having a principal amount of $1,000
or any multiple of $1,000 in excess thereof by delivering a notice to such
effect to the Trustee for the Renewable Notes on any Business Day during the
period beginning on the fourth Business Day preceding an Election Date to, and
including (if such Election Date is a Business Day), such Election Date. Such
option may be exercised with respect to less than the entire principal amount
of the Renewable Notes; provided that the principal amount for which such
option is not exercised is at least $1,000 or any larger amount that is an
integral multiple of $1,000. Notwithstanding the foregoing, the maturity of
the Renewable Notes may not be extended beyond the Final Maturity Date. If the
holder elects to terminate the automatic extension of the maturity of any
portion of the principal amount of the Renewable Notes on any Business Day
during the period beginning on the fourth Business Day preceding an Election
Date to, and including (if such Election Date is a Business Day), any such
Election Date, such portion will become due and payable 366 calendar days from
and including the 15th day of the month in which such election is made;
provided, however, that if such 366th calendar day is not a Business Day, such
portion will become due and payable on the immediately preceding Business Day.
An "Election Date" shall be the fifteenth day of each month from June 1996 to
March 2000 inclusive. Upon delivery of a notice electing to terminate the
automatic extension of a Renewable Note or any portion thereof to the Trustee,
such election shall be irrevocable.
The Renewable Notes will bear interest from the date of issuance until
the principal amount thereof is paid or made available for payment at a rate
determined by reference to the Base Rate (based on the Index Maturity) plus
the Spread. If the holder of a Renewable Note elects to terminate the
automatic extension of such Renewable Note or any specified portion thereof,
the Spread applicable to such Renewable Note or specified portion thereof will
remain at 0.07% per annum.
The Renewable Notes will not be redeemable at the option of Morgan
Stanley Group Inc. prior to the Final Maturity Date.
The Renewable Notes are further described under "Description of Notes --
Renewable Notes" in the accompanying Prospectus Supplement, except that to the
extent terms described below are inconsistent with such description, the terms
described below shall control.
<TABLE>
<S> <C> <C> <C>
Principal Amount: $125,000,000 Election Dates: The fifteenth day of each
month from June 1996 to
Initial Maturity Date: June 16, 1997, or if such day March 2000, inclusive
is not a Business Day, the
immediately preceding
Business Day
Final Maturity Date: May 15, 2001, or if such day
is not a Business Day, the
immediately preceding Redemption Dates: N/A
Business Day
Redemption Percentage: N/A
Base Rate: LIBOR
Alternate Rate Event
Index Maturity: One month Spread: N/A
Spread: Plus 0.07% per annum Interest Payment
Period: Monthly
Incremental Spread: N/A
Specified Currency: U.S. Dollars
Incremental Spread
Commencement Date: N/A Issue Price: 100%
Settlement Date
Spread Multiplier: N/A (Original Issue Date): May 15, 1996
Maximum Interest Rate: N/A Book Entry Note or
Certificated Note: Book Entry Note
Minimum Interest Rate: N/A
Reporting Service: Telerate Page 3750
Initial Interest Rate: 5.49969%
Senior Note or
Initial Interest Reset Date: June 15, 1996, or if such day Subordinated Note: Senior Note
is not a Business Day the
immediately preceding Trustee and
Business Day Calculation Agent: Chemical Bank
Interest Accrual Date: May 15, 1996 Additional Terms: N/A
Interest Reset Periods: The first Interest Reset
Period will be the period
from and including June 15,
1996 to but excluding the
immediately succeeding
Interest Payment Date.
Thereafter, the Interest Reset
Periods will be the periods
from and including an
Interest Payment Date to but
excluding the immediately
succeeding Interest Payment
Date
Interest Payment and
Interest Reset Dates: The fifteenth day of each
month commencing June 15,
1996, or if such day is not a
Business Day the immediately
preceding Business Day
Interest Determination Dates: Two London Banking Days
prior to Interest Reset Dates.
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Capitalized terms not defined above have the meanings given to such terms in
the accompanying Prospectus Supplement.
MORGAN STANLEY & CO.
Incorporated
