K&L Gates has become the latest firm to look to expand into Australia, with the US firm confirming it is in merger discussions with Australia's Middletons, writes The AmLaw Daily.

Tie-up discussions between the two firms began several months ago and formal proposals could go to their respective partnerships before the end of the year, the firms said in a joint statement.

K&L Gates had been holding talks about a possible tie up with a number of firms in Australia over recent months, with Legal Week reporting in May that the firm was eyeing an Aussie outpost. Middletons – a full-service firm with offices in Brisbane, Melbourne, Perth, and Sydney – was viewed as a leading merger candidate.

200-lawyer Middletons grossed $117 million (£74.5m) in the fiscal year ending 30 June, according to Australian publication Business Review Weekly. For its part, K&L Gates grossed $1.06 billion (£675m) and recorded profits per equity partner of $890,000 (£566,000) in 2011. It currently has nearly 1,800 lawyers spread across 41 offices worldwide.

"Our leadership teams believe that the client-driven consolidation and globalization evident in the market for legal services will continue unabated and the potential synergies that would arise from the combination of our firms deserve (and are receiving) serious consideration," K&L Gates chairman and global managing partner Peter Kalis and Middletons national managing partner Nick Nichola said in a joint statement issued on Thursday.

A tie-up with Middletons would enable K&L Gates to strengthen its position in the Asia-Pacific region and offer benefits in a variety of overlapping practice areas, including corporate, energy, banking, labour, litigation, intellectual property, and regulatory, among others.

Australia has become a hotbed of merger activity lately, with global firms looking to capitalise on an uptick in trade between companies in that country and those based in other Asian nations. Norton Rose, Linklaters, and Ashurst are among the large UK firms that have combined with top domestic firms Down Under in the past two years. In June, partners at Herbert Smith and Australia's Freehills approved a merger that will become effective in October. Other recent tie-ups in the country include the China-Australia merger that created King & Wood Mallesons earlier this year, and DLA Piper's combination with its long-time Australian relationship firm, DLA Phillips Fox, which took effect last May.