City firm Hammonds and US firm Squire Sanders & Dempsey are discussing a merger that would create a 1,300-lawyer transatlantic practice with combined revenues of more than £400m.

In a statement released this afternoon, the firms said that they are ‘evaluating the possibility’ of a tie-up, although ‘much remains to be done before bringing the merger to a partnership vote’.

The statement said that partners are likely to be asked to vote on the merger before the end of the year.

If partners vote in favour, the deal will become the third major transatlantic tie-up to be given the green light in the last 12 months. The merger between City firm Denton Wilde Sapte and US firm Sonnenschein Nath & Rosenthal is due to complete on 30 September, creating a 1,400-lawyer, £500m practice. City firm Lovells and US firm Hogan & Hartson finalised their merger in May with the creation of Hogan Lovells, comprising 2,500 lawyers and revenues of around £1.1bn.

Squire Sanders chair James Maiwurm and Hammonds managing partner Peter Crossley said that preliminary discussions showed that both firms are ‘focused on strategic geographic and practice growth’, that ‘meets multinational clients’ desire to work with fewer law firms and with firms that have demonstrated global depth and breadth’.

The firms’ leadership groups have identified ‘compatible client bases and culture’, the statement said.

Maiwurm said: ‘While we are still at an early stage, our discussions to date indicate that such a merger would appeal strongly to clients that want high-quality legal services from lawyers who have global experience and who understand and respect client demand for value.

‘Squire Sanders is committed to being a global firm. We need 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 Squire Sanders’ broad-based Latin America resources.’

Crossley said that Hammonds’ long-term strategy targets growth in the UK and Asia, expansion of the firm’s footprint in continental Europe and the establishment of closer ties with the US. ‘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,’ he said.