A spate of US/UK law firm mergers marks a scramble for position in a changing international legal market.Alan Hodgart, respected market commentator and consultant at Huron Consulting, believes that the largest corporate law firms are morphing into two different beasts. ‘Global elite’ firms advise on only the biggest deals and pay the most lucrative partner salaries (he cites Slaughter and May and Sullivan & Cromwell as examples), while ‘business law’ firms (like DLA Piper) provide a comprehensive array of legal services to major corporates. Hodgart predicted that eight to 10 firms will comprise the global elite, with around 30 making up the business law contingent. ‘Small- to mid-cap’ firms and ‘specialist’ firms sit below these bigger firms.

When City firm Lovells and US firm Hogan & Hartson announced their merger at the end of last year, Hodgart categorised the resulting firm – comprising 2,500 lawyers and combined revenues of £1.1bn – as a business law firm, rather than a global elite firm.

Then came the merger of City firm Denton Wilde Sapte and US firm Sonnenschein Nath & Rosenthal, which by 30 September will create a 1,400-lawyer, £500m practice. As of last week, the latest candidates for a transatlantic tie-up are City firm Hammonds and US firm Squire Sanders & Dempsey. They are discussing a merger that would create a 1,300-lawyer practice with combined revenues of more than £400m.

It appears that these mergers mark the scrabble for positioning predicted by Hodgart, although the agreed DWS and proposed Hammonds tie-ups will not propel the firms into the global elite. But if there is room for only 30 firms in the business law tier, it is unlikely, looking at the work these firms do now and comparing it to their peers, that they would be classed as such.

However, this may well change. The mergers might be the first step in comprehensive internal transformation over the coming years, or the firms might make subsequent major acquisitions so they have the tools to offer the comprehensive service required of a business law firm. If they are attempting to position themselves as such, rather than as small- to mid-cap firms, then DWS, Hammonds and their merger partners are giving themselves a head start by teaming up. According to Hodgart, business law firms will need to cluster around the headquarters of all major global corporations in order to compete.

If his predictions are correct, then the spate of transatlantic mergers – which many commentators predict will continue – appears to be one trait of a wider gold rush to secure a spot in the two most lucrative law firm groupings.