* Former regional premier also target of investigation
* Investigation looks into suspected breach of trust
* Morgan Stanley says cooperates with prosecutors
FRANKFURT, July 11 (Reuters) - German prosecutors have opened preliminary proceedings into alleged links between Morgan Stanley's top dealmaker in Germany and one of Baden-Wuerttemberg's top politicians, relating to the state's purchase of shares in German utility EnBW in 2010.
The Stuttgart public prosecutor's office said "sufficient and actual clues have emerged" suggesting ex-premier Stefan Mappus could have made himself liable to prosecution for breach of trust, while Morgan Stanley's Dirk Notheis could have made himself liable to prosecution for aiding and abetting breach of trust.
Notheis, 44, who ran Morgan Stanley's operations in Germany and Austria for more than three years, was granted leave of absence by the bank last month following an uproar over emails he reportedly exchanged with Mappus.
German newspapers in June published copies of emails Notheis reportedly sent to Mappus in 2010, when the southwestern state was trying to purchase a 45 percent stake in local utility EnBW from French energy group EDF.
In the emails published by the newspapers, Notheis appears to give Mappus advice on how to limit time for political debate on a renationalisation of EnBW, Germany's third-largest utility.
In a statement on Wednesday the prosecutor's office said several premises had been searched as part of the proceedings and a number of documents were seized.
"All of the accusations of breach of trust are without merit. And that is what the investigation will show", Notheis told Reuters.
A Morgan Stanley spokeswoman said in an emailed statement: "We confirm the presence of the Stuttgart public prosecutor's office in our business premises today. Morgan Stanley is cooperating with the public prosecutor's office during its investigation."
The reports prompted a wave of criticism, in part because they highlighted the cosy relationship between bankers and politicians when many Germans are angry about the role banks have played in the global financial and euro-zone debt crises.
The prosecutors also quoted a report by a government audit body which said the 4.7 billion euro ($5.76 billion) purchase price paid by Baden-Wuerttemberg for the stake in EnBW was at least 180 million euros too high.
According to the opinion of a separate report drawn up by auditors Warth & Klein Grant Thornton, which was mandated by the regional state's government to assess the deal, Baden-Wuerttemberg had overpaid by around 840 million euros, the state's government said in a statement.
In Germany, Morgan Stanley ranked second behind Deutsche Bank and ahead of U.S. rival Goldman Sachs in mergers and acquisitions rankings in the year-to-date, measured by overall deal value, Thomson Reuters data show.
Notheis' absence will be a blow for the investment bank, which had come to rely on him and his connections for lucrative advisory roles or mandates in merger and acquisition deals.
Morgan Stanley has won some big mandates from companies in which Germany retains an equity stake.
It was for example co-bookrunner for Commerzbank's 11 billion euro rights issue, was adviser to Deutsche Telekom's aborted $39 billion sale of T-Mobile USA to AT&T and was bookrunner for Deutsche Post DHL on a 750 million euro exchangeable bond for state-controlled development bank KFW.