Beachcroft is in merger talks with Davies Arnold Cooper (DAC) in a deal that would create an insurance law firm with combined revenues of around £175m.

The move – which follows news of merger talks between fellow insurance specialists Clyde & Co and Barlow Lyde & Gilbert – would gift both firms a broader international presence, with Beachcroft currently housing offices outside of England in Dublin, Wales, Brussels, Singapore and New Zealand, while DAC has a presence in Spain and Mexico.

Both parties cite real estate, litigation, corporate, employment, and health and life sciences as the main practice synergies between the two firms.

Beachcroft managing partner Paul Murray (pictured) said: "Our merger discussions with DAC are driven by the opportunity to enhance how we work with clients in industry sectors in which both firms specialise, and in particular the insurance sector.

"The combination of Beachcroft's leading volume and UK insurance practice with DAC's strong insurance and dispute resolution team in London, Spain and Latin America would create a distinctive, full service offering for our insurer clients."

DAC senior partner Danny Gowan said: "In addition to creating a stronger offering to the insurance sector and increased investment internationally, a merger would provide significant advantages to our real estate, corporate and employment teams, which have grown significantly over recent years."

Beachcroft has been in expansive mode so far in 2011, announcing a Singapore launch in January and opening its second New Zealand base in Wellington with the hire of a team of insurance lawyers in May.

Last year the firm posted an 8% increase in turnover for 2009-10, with fee income rising to £131m, while profits per equity partner (PEP) grew 4.3% to £314,000.

In comparison, DAC's PEP fell by 23% in 2009-10 to £276,000 after holding steady at around £350,000 between 2007 and 2009.

The firm has seen revenues grow by almost 40% since 2006-07 to a high of £45m in 2008-09, although fee income did dip slightly to £44.1m last year.

News of the discussions comes in the wake of the merger talks between Clydes and Barlows – exclusively revealed by Legal Week earlier this month – set to form a £300m-plus insurance powerhouse.

If confirmed, the tie-up would create an insurance leader that would dominate the market, with both firms working with key players including ACE, Allianz, AXA and Chartis.