When KPMG Consulting floated its initial public offering earlier this year, the next step on the firm's agenda was to consolidate its worldwide operations into one legal entity. The plan was to use the firm's equity to purchase its operations around the world, thus creating a single, global organization.

The European firms were to link up with one another within months of the float, then, when SEC approval was in place, the U.S. operation was to consolidate with the European group. However, there were problems with this scenario from the outset.

The French KPMG practice sold itself to CSC in 1998, and the Belgian practice was acquired by PricewaterhouseCoopers in 1999. More recently, the Italian KPMG Consulting group decided not to join the rest of its remaining European brethren in the consolidation effort.

It appears that the plan for consolidation is now uncertain. "This was all supposed to have happened months ago, but now the indications are than it will have to wait until the autumn when it is hoped the technology sector will start to pick up. There is no appetite for acquiring the European operations at the moment," said an unnamed senior source at KPMG Consulting.

Meanwhile, shares of KPMG Consulting listed on the Naasdaq index as KCIN have dropped from their float price of $18 to a low of $10 and are now hovering around $14 each. The market value of KPMG Consulting has dropped by more than half from $6-$7 billion at the time of the float to less than $3 billion.