By Casey Sullivan
(Reuters) - Washington law firm Patton Boggs, well known for its lobbying and public policy work, is in talks to merge with a larger U.S. law firm, according to two former partners and a person with inside knowledge of the deal.
The news comes on the heels of a report by Reuters on Friday that Orrick Herrington & Sutcliffe and Pillsbury Winthrop Shaw Pittman were in advanced merger discussions to create what would be one of the top 10 largest law firms in the country.
Two former Patton Boggs partners told Reuters the Washington firm, with nearly 500 lawyers and public policy advisers, is in merger discussions with Locke Lord of Dallas, which has more than 650 lawyers and consultants. A third source, who has direct knowledge of the matter, would not confirm or deny that the other party was Locke Lord.
Patton Boggs said in a statement on Sunday that all law firms that recognize the rapidly changing landscape should be looking for ways to improve their platform for their partners and to better serve their clients.
"If we find a combination that accomplishes these goals, we would have an announcement if and when we pursue it," it said.
Locke Lord said on Sunday it "never affirms or denies any speculation about...potential mergers."
"In line with our strategic plan, we regularly look at growth opportunities that would benefit our firm and our clients, but we do not comment one way or the other," a statement from the firm said.
The partners, who left Patton Boggs earlier this year, said they had knowledge of the merger discussions from lawyers inside the firm. They spoke on condition of anonymity because they were not authorized to speak publicly about the issue.
Separately, Patton Boggs is also in merger talks with a law firm outside the United States, the partners said, although they had not been told its identity.
The 51-year-old Patton Boggs is known historically for its influence on Capitol Hill and has represented a number of large companies and institutions this year like AT&T (TATTC.UL), Goldman Sachs (GSGSC.UL) and Amazon.com Inc (AMZN) in their lobbying efforts, according to OpenSecrets.org, which publishes information on lobbying.
Locke Lord, which is known for its energy, litigation and insurance practices, has recently represented companies such as Natural Gas Partners, Argent Energy (AET_u.TO) and White Deer Energy, in acquisitions and financing arrangements, according to its website.
Both firms have represented parties in litigation arising from the September 11 attacks on the United States.
In March, Patton Boggs announced it had laid off 30 lawyers and 35 staff members and that revenue had dipped 15 percent in its 2012 financials, according to the legal trade publication American Lawyer.
There have been at least 58 mergers between U.S. law firms announced in 2013, a particularly active year, according to legal consultancy Altman Weil. In the first half of the year activity was its highest since 2008, Altman reported.
Merger activity has been driven by the globalization of corporate clients who face complex national and international legal issues and by sluggish demand for legal services, experts say.
Patton Boggs ranked No. 95 out of U.S. law firms for revenue in 2012 at $317,500,000 and No. 91 in profits per partner at $735,000, according to figures published in the American Lawyer. Locke Lord ranked No. 69 for revenue in 2012 at $428,500,000 and No. 65 in profits per partner at $1,065,000, according to the magazine.
A managing partner of another large U.S. law firm said that his firm had been approached by Patton Boggs earlier this year about a potential combination, but that the firm turned the offer down.
(Reporting by Casey Sullivan; Editing by Noeleen Walder, Ted Botha, David Brunnstrom and Diane Craft)