BUSINESS BRIEF Hammonds Suddards/Edge Ellison merger

Anne Mizzi analyses the Hammond Suddards/Edge Ellison merger, announced last weekThe fate of Edge Ellison's loss-making Leicester office hangs in the balance following its merger with Hammond Suddards.

It is understood that the unprofitable office will be axed and that the firm is in discussions with staff about their future.

A spokesman said lawyers will be given the option to move to the Birmingham office, but said some support staff would face redundancy.When Leicester closes, Hammond Suddards Edge will cover the midlands from the former Edge Ellison Birmingham office.Sources say Edge's insurance practice also faces uncertainty given Hammonds' increasing corporate focus, although no decision has been taken.The new firm will be governed by Hammonds' partnership deed, and its board will be Hammonds partner-heavy.

It will have one managing partner from each firm, although Hammond Suddard's managing partner Chris Jones will take the driving seat.The merger announcement came less than a month after the firms held their first 'serious' meeting.

Both firms have spent millions on branding in the past year, and the merger will force them back to the drawing board.

Mr Jones said the new firm will start again with a new brand: 'We are going to have a completely new approach.

It's a new firm.'The firm is likely to be keen to push ahead with a new brand, as it has already been dubbed 'Ham & Eggs' by rivals.And then there is a question of profitability.

Mr Jones confirmed that Hammonds' spread was between 100,000 and 145,000 last year, while Edge Ellison's partner profits were not in the same band.

Edge Ellison partners' profits were said to be between 90,0000 and 120,000.

Mr Jones admitted: 'Edge Ellison was not as profitable as Hammond Suddards but it was no way near a significant barrier to prevent what is otherwise a good merger.' But Mr Jones said Edge Ellison has instituted a number of initiatives to drive up profitability, adding: 'It's all done as part of the merger agreement.

The disparity wasn't as great as the tables indicate.'The merger will also force the two firms to review their European relationships.

Hammond Suddards is affiliated with Commercial Lawyers Association (CLA), while Edge Ellison is linked with the International Lawyers Network.

Mr Jones said: 'We have got to appraise which one we go with.' Hammonds' CLA may win because its has a more European orientation.The merger is billed as a platform for overseas expansion and the merged firm intends ultimately to move into Germany, Italy, France and the Netherlands.

Mr Jones said: 'We plan to merge in all the major European centres.

We have no plans to look to North America.

Having put together a firm of this size, we are going to be a lot more attractive to European firms.' With Leicester's closure, the merger will give Hammonds a Birmingham office and grow its City practice by combining the two London firms' offices on top of its existing Leeds and Manchester coverage.

Nationally, it is a good fit - and a springboard from which to launch a European offensive.