The German partners of Andersen, the accountancy firm embroiled in the Enron scandal, have chosen to merge with Ernst & Young after rejecting a merger with KPMG.

The decision, made at an extraordinary general meeting on Wednesday, is in line with the majority of partnerships in other countries. The merger will create a new force in the German market to rival market leader KPMG and number two PricewaterhouseCoopers. The new group will still lag behind them in third place with a combined annual turnover of around €800m ($718m) compared to KPMG and PwC, which both claim annual turnovers of more than €1.4bn.