East Coast firm Drinker Biddle & Reath has significantly beefed up its Chicago offering after agreeing a merger with 200-lawyer Chicago firm Gardner Carton & Douglas.

The deal, which goes live on 1 January, 2007, creates a 650-lawyer firm with a dozen offices and annual fee income approaching $350m (£185m), making the new practice one of the largest firms by revenue in Philadelphia.

The combined firm will practise under the Drinker Biddle name apart from in Illinois and Wisconsin, where it will be known as Drinker Biddle Gardner Carton until 2008. Drinker Biddle's Philadelphia hub will remain as the overall headquarters of the new firm.

The move comes despite Gardner Carton facing a multimillion-dollar claim relating to allegations that former partner Steven Loren took kickbacks while representing the Teacher's Retirement System of the State of Illinois.

The merger continues a run of tie-ups between US firms in recent months. Most notably, the proposed mega-merger between New York firm Dewey Ballantine and expansive West Coast giant Orrick Herrington & Sutcliffe is set to go live in January next year, subject to a partner vote.