HP agrees fee for PwC consulting arm

The multibillion dollar cash and stock offer comes only days after the world’s number two computer manufacturer emerged as front runner to buy the professional services firm’s consultancy arm.

Sources close to the deal do not expect a final agreement until end of the month, financial wire service Bloomberg claimed.

Top level talks last weekend between Hewlett-Packard and the world’s largest professional services firm were previously thought to have edged nearer to striking a deal of up to $20 billion.

PwC are also understood to have held in-depth discussions with other companies, who could launch rival bids until a written agreement is reached.

Senior executives at Hewlett-Packard, according to Bloomberg’s report, also want time to put together lucrative financial packages to keep top PwC consultants that they consider to be the firm?s prime asset.

A New York-based PwC spokesman labelled the report ‘rumour and speculation’.

He confirmed that the firm was in negotiation over the sale of its consultancy division, but declined to make further comment until an announcement was made. Hewlett Packard could not be reached.

PwC will need to secure the support of its 10,000 worldwide partners, as well as approval from the SEC, who will need to see that remaining audit firm has no say over the new consultancy firm.

PwC announced plans to spin-off its consultancy operation in February following pressure from the US Securities and Exchange Commission to split its business to avoid conflicts of interest.

Europe’s largest consulting and IT group Cap Gemini paid $6.8bn this year for Ernst & Young’s consulting wing.

HP in talks for PwC consulting business

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