Hammonds is in advanced stages of merger talks with US firm Squire Sanders & Dempsey.

Management at the two firms have held discussions about a merger over recent months, with the plan announced to their respective partnerships today (25 August).

The process is currently in the due diligence stage, with the intention of confirming the merger on 1 January 2011 if the talks proceed successfully.

The discussions have been led by Hammonds managing partner Peter Crossley, non-executive chairman David Hearn, and Squire Sanders chairman James Maiwurm. The name of the new firm and the specific financial arrangements of the tie-up are still under discussion.

Squire Sanders reported 2009 turnover of $545m (£353m), while profits per equity partner (PEP) stood at $795,000 (£516,000).

Hammonds' 2009-10 financial results saw PEP rise 32% to £364,000, while turnover dropped by 6% to £117.8m.

As such, the potential tie-up would create a firm of comparable size in revenue terms to SNR Denton – the union of Denton Wilde Sapte and Sonnenschein Nath & Rosenthal scheduled to go live on 30 September.

Squire Sanders has more than 800 lawyers and around 150 equity partners across 32 offices throughout the US, Asia, Europe and South America, while Hammonds has 10 offices around the world, including four in the UK.

In a statement, Maiwurm said: "Squire Sanders needs a more complete presence in the UK and Western Europe to complement our strength in Central and Eastern Europe. Hammonds has a well-developed platform that would complement our presence in Europe, would add to our capabilities in Asia and would enhance our broad-based Latin America resources."

In recent years Hammonds has been aiming to broaden its coverage in the emerging economies, while Squire Sanders has also looked to boost its UK and European capabilities.

The US firm has explored a number of merger deals that would have substantially expanded its international footprint, including unsuccessful talks last year with Denton Wilde Sapte as well as prolonged discussions with the now-defunct Coudert Brothers back in 2004.

Hammonds has an existing loose referral relationship with US firm Holland & Knight, but has been exploring its options in the States for some time. In 2008 the firm set up a committee, which included corporate head William Downs, US head David Hull and Crossley, to look into its opportunities in the US.

Crossley commented: "Operating as one firm around the world is a foundation of the Hammonds culture which is shared by Squire Sanders. There is an obvious cultural fit between the two firms."

For more analysis, see Hammonds/Squire Sanders – a promisingly defensive deal.

Click here to read The American Lawyer's coverage of the merger deal.

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