Mitsubishi UFJ Financial Group didn't drive as hard a bargain with Morgan Stanley as Warren Buffett did with Goldman Sachs. After the Wall Street bank's shares plunged almost 60% last week, the Japanese bank got a chance for a do-over.

Mitsubishi UFJ Financial Group (nyse: MTU - news - people ) is renegotiating its $9 billion deal to buy a 21% stake in the embattled Wall Street bank to make the purchase consist solely of convertible preferred shares, according to various news reports. The preferred shares would yield 10% and protect MUFG from near-term volatility in Morgan's share price.

In September, MUFG agreed to buy $6 billion in convertibles and $3 billion of common shares (See " Morgan Stanley's Jolt From Japan"). But that started to look like a very sour deal, as a 58% decline in Morgan's shares last week left the bank with a market value of $10.3 billion, little more than the Japanese bank was set to pay for a 21% stake.

Wall Street's fears about Morgan Stanley's solvency could not be shaken, despite the firm's repeated assurances. Contributing to the slide were worries that Mitsubishi UFJ was going to back out of the deal.

Billionaire investor George Soros publicly urged the U.S. Treasury to save the Morgan Stanley-MUFG deal by buying an equivalent amount of preferred shares in the bank at a higher conversion price. There were reports Sunday that the Treasury had bowed to Japanese requests to guarantee that MUFG's investment would not be devalued if the U.S. government were to inject funds into Morgan Stanley at a later date.

MUFG will be able to convert the $9 billion worth of preferred shares it will buy into common stock at a price of $20 to $25, according to a Reuters report, down from the earlier negotiated price of $31.25. MUFJ reportedly will also offer a credit line to Morgan Stanley in a bid to shore up investor confidence. Credit-ratings agency Moody's put Morgan Stanley's long-term debt on watch for a downgrade Thursday.

Morgan Stanley (nyse: MS - news - people ) closed down 22.3%, to $9.68, in New York on Friday. Tokyo trading is closed on Monday due to a national holiday.

If the deal closes on those lines, it would bring it closer to the lucrative terms Warren Buffett extracted from Goldman Sachs (nyse: GS - news - people ) for his $5 billion cash injection, about a day after MUFG's Morgan deal was disclosed (See " Buffett's Golden Goldman Buy"). The perpetual preferred shares that Berkshire Hathaway (nyse: BRK.A - news - people ) bought, when Goldman was scrambling to prop up its share value, pay a sweet 10% dividend, and the Omaha company also gets dibs on $5 billion of common shares at $115 each if it chooses. Goldman shares were over $200 last year.

Japanese banks have swooped in during the Wall Street crisis to pick up U.S. banking assets on the cheap. Nomura Holdings bought Lehman Brothers' Asian and European units at bargain prices (See " Nomura Wins The Lehman Asia Stakes").

"I think in general [investment banking] is a function that the banks have been really wanting for a long time ... and also this is one that the Japanese banks are not very strong in," said Nana Otsuki, Tokyo-based analyst for UBS Securities, of the deals.