BearingPoint to Sell Off Its Key Businesses

Embattled McLean consulting firm BearingPoint appears to be near its end.

The company, which filed for bankruptcy protection last month, said late last night that it had reached an agreement with several parties -- including PricewaterhouseCoopers and Deloitte -- to sell "substantially all of its businesses."

"We have concluded that a sale of the company's business units maximizes value and provides the greatest stability for all interested parties. We are pleased that several parties have expressed interest in purchasing the majority of the company," BearingPoint chief executive Ed Harbach said in a statement.

Deloitte is buying a "significant portion" of BearingPoint's public services business, its largest and most successful unit, for $350 million. Pricewaterhouse will buy a "substantial portion" of the firm's North American commercial services unit, including a segment focused on financial services, for $25 million. It was not clear what would happen with the remaining portions.

BearingPoint's management teams in Europe and Latin America are in late-stage negotiations to buy the businesses in both regions. There are also deals in the works for the company's operations in Asia. The proposed transactions would require bankruptcy court approval.

BearingPoint employs more than 15,000 people around the world, including more than 3,600 in the Washington region. The firm had been weighed down by $1 billion in debt before its bankruptcy filing, and it had been facing an April 15 deadline to repay $200 million in loans.

The company had been pursuing a sale or merger before its "pre-arranged" bankruptcy filing, but the recession and credit crunch crushed those acquisition plans -- or at least appeared to. Last night, BearingPoint spokesman Aaron Bedy said: "We've always said we would evaluate offers and these offers came in. They were in the best interests of all parties."

While some of the overseas management buyout teams could decide to keep the BearingPoint name, it is unlikely that the buyers of the U.S. businesses would do the same, all but guaranteeing the erasure of BearingPoint's imprint from corporate America.

BearingPoint was spun off from KPMG in 2001, but it struggled to find its footing, hurt by accounting and infrastructure problems -- the kind its own customers paid the firm to solve. BearingPoint was also investigated by the Securities and Exchange Commission in 2005.

In recent years, BearingPoint had cycled through management and slashed its employee headcount.

Now the company appears to have found a way out.

"These offers reflect the inherent value of our business and the world-class service we continue to provide our clients," Harbach said.