Andersen in Sales Talks

The accounting firm Andersen, damaged by its connections to bankrupt client Enron Corp., is talking with Big Five accounting firm Deloitte Touche Tohmatsu about selling some or all of its operations, according to reports.

Negotiations began last week between New York-based Deloitte and Chicago-based Andersen, the New York Times reported late Sunday on its Web site. The newspaper cited sources involved in the talks who spoke anonymously.

The Securities and Exchange Commission and other agencies are investigating Andersen’s work for former energy giant Enron Corp., which filed for Chapter 11 bankruptcy protection Dec. 2 amid questionable accounting practices. Investigators have centered on the alleged shredding of Enron documents by Andersen, which was Enron’s chief auditor.

The New York Times reported that negotiations between Deloitte and Andersen began last week. A deal, the terms of which aren’t known, could be announced this week. The newspaper said discussions are still “fluid,” and no decision has been reached on whether Andersen would be sold in pieces or completely.

The Wall Street Journal, meanwhile, reported on its Web site Sunday night that Andersen is negotiating with federal prosecutors over possible criminal indictments.

The Journal said the company will meet with the Justice Department to try to reach an agreement that would avoid “criminal obstruction-of-justice charges.”

The New York Times said the key points being discussed by Deloitte and Andersen include how the former can avoid the “legal and financial liabilities” being faced by Andersen.

Several high-profile clients have defected from Andersen in the wake of the Enron collapse. Last week, Delta Air Lines and Freddie Mac fired the accounting firm. Other defections include Merck & Co. and SunTrust Banks.