Coudert Brothers is set to break from its Frankfurt and Berlin offices as part of a restructuring plan aimed at preparing the embattled US firm for a merger.

The New York firm's decision to shut down its seven-partner German operation emerged this week as part of a larger restructuring plan aimed at repositioning Coudert in the aftermath of Orrick Herrington & Sutcliffe's raid on its London and Moscow partnerships last month.

Coudert's six-partner Frankfurt office and one-partner Berlin branch are expected to formally cease to be part of Coudert's partnership from 30 September. It is believed that Clifford Chance has been instructed to advise on the split.

The move will end Coudert's presence in Germany, which was secured with the 2000 merger with Frankfurt-based Schurmann & Partners. The firm's national practice suffered a major blow in January 2004 when the bulk of its Munich arm left for Dechert.

The impending German closure comes on the heels of the firm's announcement this week that it is to shut its 12-lawyer San Francisco office by the end of the summer and mounting indications that the firm is overhauling its practice to secure a firm-wide merger.

One partner at the firm said the two office closures were part of a restructuring plan that is expected to impact on several other offices.

Coudert's 23-partner Belgian practice – which makes up more than half of its remaining European partnership – is also separately in talks with management over its future. Coudert's only other major European practice is its eight-partner Paris operation.

One former Coudert partner told Legal Week: "The firm is making a clear cut now in response to what has happened in London and Moscow. It is closing offices to continue to survive and more specifically to get a successful merger deal."

Meanwhile, Orrick is close to completing negotiations with Coudert's London associates this week, with the notice period for the eight departing UK partners ending on 17 June.

All 22 London associates are expected to start at Orrick on 20 June, with the firm also taking a further 38 support staff and trainees. Orrick has taken out an additional floor at its London offices in Tower 42, adding a further 3,000 sq ft to the 15,000 sq ft it currently occupies.

It is understood that the two firms have agreed to settle threatened litigation after Coudert instructed Simpson Thacher & Barlett to investigate Orrick's conduct for potential breaches of fiduciary duty.