Merger talks between Eversheds and Bristol firm Veale Wasbrough have collapsed.
The breakdown in the talks is a blow to Eversheds' ambitions to rival leading Bristol firms such as Osborne Clarke, Bevan Ashford and Burges Salmon.
An Eversheds spokeswoman initially denied that there had been merger talks.
However, Veale Wasbrough's chairman, Derek Bellew, confirms that the marriage is off.
"It was decided the merger would not meet the strategic objectives of either firm and we will not be pursuing further discussions," he says.
The Lawyer revealed last November that Eversheds was in merger talks with 29-partner Veale Wasbrough. The Bristol-based firm is ranked as one of the top five law firms in the area and has a reputation for its public sector work.
Eversheds opened up an office in Bristol in 1994, to compete against other local firms such as Bevan Ashford, Osborne Clarke and Burges Salmon. However, the practice has remained small, overshadowed by its much bigger Cardiff practice.
David Vokes, managing partner at Eversheds Bristol, says the failure to merge is not a setback and insists his firm remains committed to expanding in the city.