Private equity group TPG Capital has approached accounting giant Ernst & Young (EY) about buying a stake in its consulting arm, Financial Times reported on Tuesday, citing a letter it had reviewed.

TPG outlined its plan for a debt-and-equity deal to separate the consulting arm from EY's audit business in a letter sent to the firm's global and U.S. bosses, the FT report added.

TPG and EY did not immediately respond to Reuters' requests for a comment.

In September last year, EY announced its plans to split its audit and consulting units into two companies after regulators voiced concerns that the audit arm would not do its job fairly for its client if it also employed EY as a consultant.

But the plan, code-named "Project Everest", faced resistance from some of EY's partners. The company said its U.S. executive committee decided not to move forward with the split, and in April this year called off the plan.

Later that month, the U.S. arm of EY, one of the Big Four accounting giants, also said it was shedding 5% of its workforce, affecting around 3,000 of the company's U.S. employees.

(Reporting by Manya Saini in Bengaluru; Editing by Shilpi Majumdar)