The calm of the Chambers office was, if not shattered, then at least mildy disturbed last Thursday by the news that Lovells and US firm Hogan & Hartson are in the early stages of merger talks. While it’s far too early to see the merger as a foregone conclusion – as Ashurst or Watson Farley & Williams could tell you, transatlantic negotiations are never straightforward – the mere fact that the two are talking has been enough to get tongues wagging across the City. After all, as LegalWeek (who broke the story) pointed out, there has been no shortage of speculation about US-UK mergers in the last year, but this is the first sign such moves are genuinely in the offing.

What’s more, while few in the City would welcome the emergence of a new top-10 global law firm as a competitor, many might feel a pleasant surprise at such an ambitious move by Lovells, which many see as a group of excellent lawyers kept from greatness by a lack of drive. While this view – the suggestion that Lovells could somehow push its way into the magic circle if it only had the will – has always been oversimplistic, it’s certainly true that the firm’s partnership leans towards conservatism in strategy and a certain cosiness in culture (a mood the current leadership, and particularly managing partner David Harris, has sought to change – with varying degrees of success).

In truth, though, it’s quite logical for Lovells to be the first major City firm in several years to discuss a transatlantic merger: it’s always had one eye on the US. It opened its New York office as long ago as 1977, and its New York and Chicago offices together boast 26 partners. What’s more, its UK practice has long carved out a niche representing US clients in the UK, including Ford and Xerox.

What’s more, the practices of the two firms have some striking overlaps. Indeed, Lovells’ practice – with corporate and finance playing second fiddle to large litigation, real estate and IP practices – resembles a US firm model in many ways. A quick look through the rankings in Chambers UK and Chambers USA sees the two firms sharing rankings in a host of areas.

*Indicates rankings for UK-Wide sections (Lovells) or US Nationwide sections (Hogan & Hartson). All other rankings are London (Lovells) or District of Columbia (Hogan & Hartson)

It’s clear that the firms share considerable skill in regulatory areas, projects, disputes and insurance. And, like Lovells, Hogan combines these strengths with a decent multi-site corporate practice. A merger between these two wouldn’t create a transactional powerhouse – or, probably, satisfy the critics who have always said corporate should be Lovells’ priority. But Hogan offers probably the best transactional practice of any regulatory-focused US firm: for example, no other US firm with a high ranking in Privacy & Data Security also features in the nationwide Corporate table. (The financial fit, too, is pretty good, as LegalWeek points out.)

Still, as Richard Gubbins of Ashurst told us at a recent round table, when it comes to US-UK mergers, “you mustn’t underestimate the importance of culture.” So what kind of match would we see there? Although Hogan & Hartson declined to allow its associates to be interviewed for our US Student guide, Chambers Associate, it generally has a reputation for collegiality – not a bad fit for a firm many consider “too nice for the magic circle.” But the thorny issue of money might still be an obstacle: while Lovells has made some moves to modify its lockstep in recent years, it’s a long way from Hogan’s performance-based compensation.

Mergers that look great on paper can fall apart at any stage, for any number of reasons; conflicts are particularly good at derailing deals at a late stage. But if the deal can be done, it would be truly newsworthy – creating a new truly global player, the only top-ten firm with such a regulatory and disputes focus, and (potentially) a powerhouse in transatlantic litigation in particular. What it wouldn’t do is create a transactional powerhouse to rival the magic circle and its US equivalents. Although it’s showing a new level of ambition, Lovells is still playing to its strengths.