After CEO's resignation, Andersen looks for new leader, deals

<br>CHICAGO (AP) _ Top partners for Arthur Andersen LLP met behind closed doors Wednesday to discuss strategy in the wake of their leader's resignation. <br><br>A day after Joseph Berardino quit as

Wednesday, March 27th 2002, 12:00 am

By: News On 6

CHICAGO (AP) _ Top partners for Arthur Andersen LLP met behind closed doors Wednesday to discuss strategy in the wake of their leader's resignation.

A day after Joseph Berardino quit as chief executive of Andersen Worldwide _ the legal entity that includes U.S. operation Arthur Andersen _ the troubled firm remained wracked by uncertainty and facing huge liability from Enron lawsuits.

Berardino's successor won't be chosen until next week at the earliest, spokesman Charlie Leonard said. Andersen Worldwide's governance requires the 18-member board of partners meet to take such an action, and Leonard said no meeting is scheduled until Tuesday in London.

The Chicago firm's 1,700 U.S. partners _ who don't have a direct say in a successor _ huddled in conference rooms at Andersen offices across the country but by late afternoon, no major decisions were made or deals consummated, several said, and the mood remained as tense as before Berardino's resignation.

``The organization is incredibly nervous about its future,'' said New York-based partner Jack Gelman.

Deloitte Touche Tohmatsu is among the suitors for some of Andersen's U.S. businesses. Andersen's tax partners met in Chicago to discuss a Deloitte term sheet to acquire its tax business, according to a partner who spoke on condition of anonymity.

Asked about talks Wednesday, Deloitte spokesman Matthew Batters issued a statement saying the accounting firm will work with regulatory agencies ``for an orderly transition of clients and people if Andersen cannot continue as a free-standing firm.''

``We all would like to see Andersen survive this,'' Doug DeRito, a tax partner in the Atlanta office, said of the attempts to peddle Andersen units. ``But I think we need to be responsible and consider other viable options to protect the jobs of 28,000 employees in the U.S.''

Many partners see former Federal Reserve Chairman Paul Volcker as Andersen's best chance to stay alive. But Volcker's rescue plan, which calls for him to install and head an independent governing board, appears to be on hold unless the government abandons a criminal indictment of Andersen for destroying Enron Corp. documents. That appears unlikely.

Neither Berardino's resignation nor Volcker's proposal changes the government's plans to prepare for trial May 6, said Justice Department spokesman Bryan Sierra said.

Andersen has lost at least 85 public audit clients this year and on Wednesday Sysco Corp., a $22 billion food-service marketer and distributor, became the latest defection.

New Jersey's Casino Control Commission also voted Wednesday to force casinos and their parent companies to sever ties with Andersen by May 15.

Some experts said the failure to name a successor to Berardino quickly will cost Andersen even more business.

``The ship now seems without a captain and clients will get more panicky,'' said Itzhak Sharav, an accounting professor at Columbia University.