Consulting Alert: Enron Debacle Could Force Andersen to Divest Consulting Practice.

Business Editors

ATLANTA--(BUSINESS WIRE)--Jan. 8, 2002

Could push firm into arms of merger partner

Andersen's role in the implosion of Enron Corp. could spiral toward a divestiture of its $1.71 billion consulting operation, once the Enron disaster is played out in court, according to Consulting Alert (http://www.straffordpub.com/products/can/index.html).

In its latest edition, Consulting Alert noted that even before the Enron collapse, Andersen had entertained early merger talks with other Big Five accounting/consulting firms over the last two years, and that KPMG and Ernst & Young appear to match up best with its business strategy and clients.

However, both those two firms entered into non-compete agreements when they spun off their own consulting practices, which would make it all but certain that Andersen's consulting business would have to be divested before a merger could go through.

Legal claims against Andersen over its audit of Enron could, if proven, cost Andersen literally billions of dollars in damages, possibly crippling its ability to remain independent, according to Consulting Alert(http://www.straffordpub.com/products/can/index.html).

To read about the Andersen situation and other competitive intelligence for consulting firms, go to (http://www.straffordpub.com/headlines/consulting.html).

Consulting Alert, a twice-monthly newsletter, is the leading independent briefing on news and competitive intelligence for the management consulting profession. It is published by Atlanta-based Strafford Publications, Inc.(http://www.straffordpub.com).

Consulting Alert(http://www.straffordpub.com/products/can/index.html) is available for a limited time at the discount rate of $247 - a $50 savings off the regular price of $297. Orders should be directed to: Strafford Publications, Inc., 590 Dutch Valley Road, NE, Postal Drawer 13729, Atlanta, GA 30324-0729; Phone: [phone]; Fax: [phone]; E-mail: [e-mail].