E&Y May Divest its Consulting Business

Could Ernst & Young be following in the footsteps of Big 5 rival Arthur Andersen when it spun off its consulting arm to Andersen Consulting?

Today, E&Y announced it may sell its consulting business to Cap Gemini, a European services firm based in Paris.

Reports suggest that the combined revenue for the two entities would total more than $8.5 billion, not to mention untold more revenues in future consulting services.

Analysts are speculating that the split may be difficult given its integration with E&Y's accounting practice. However, a merger instead of a sale may help alleviate the situation.

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