Two firms set to vote next week on new transatlantic merger

Denton Wilde Sapte is to merge with US firm Sonnenschein Nath & Rosenthal, creating SNR Denton, a 1,250-lawyer firm with offices spreading across four continents.

The tie-up is set to be rubber-stamped by a partner vote next week (9 June) and will go live on 30 September, with Dentons chief executive Howard Morris named co-chief executive alongside Sonnenschein chairman Elliott Portnoy.

Sonnenschein and Dentons began merger discussions last year. Dentons highlighted profitability as a key driver for the merger, while Sonnenschein – which has only two offices outside the US – said geographical spread was the principal consideration.

Management at both firms are optimistic that they will reach the required 75% partnership approval in next week's vote.

Portnoy commented: "We never take anything for granted but we have had a heartening reaction both from clients and colleagues."

The merger has been met with mixed reactions in the market, with many peers taking a wait-and-see approach while acknowledging that the US market has moved to the top of many UK law firms' agenda.

Norton Rose chief executive Peter Martyr said: "It is not surprising during a recession that firms look to combine for a number of reasons, both offensive and defensive. There certainly seems to be a head of steam building on US/UK mergers. There is good business sense in the concept of the transatlantic merger but compatibility and business fit remain paramount considerations. Not all will succeed."

Eversheds head of international Stephen Hopkins said: "The US is world's biggest legal market so it is not surprising that Dentons, Lovells and many other firms are looking for tie-ups. Time will tell whether this is a good move [for Dentons and Sonnenschein] – many mergers that looked like a good idea have fallen apart and vice versa."

From our point of view, our strategy is always led by clients and we are not at the moment feeling a significant demand for a US merger."

Dominique Graham of City legal consultancy Graham Gill added: "We have noticed a marked increase in appetite for mergers, reflected in the number of mandates we are acting on. Last year prompted a lot of navel-gazing and house-keeping. Now firms are looking at mergers as a growth option they cannot afford to ignore."

Denton Wilde Sapte on the Legal Week Wiki