Wragge& Co is drawing up a list of London merger targets as it seeks to invest £20m of reserved cash.
Heads of department have been asked to draw up shortlists of ideal merger firms as part of their business plans, alongside recruitment and other growth opportunities.
Senior partner Quentin Poole said: “These economic downturns are very grim in many ways, but as a business they also create opportunities.
This may lead to clients questioning whether they should look at alternative lawyers, lawyers questioning whether they’re in the right firm and indeed entire firms questioning whether they should change hands.”
The Birmingham-based firm is interested in increasing its capability in Londoncentric areas, for which it is more difficult to recruit in the Midlands.
These include financial services, private equity, property finance and property funds.
At the end of the 2007-08 financial year the firm had £20.7m in the bank.
Wragges entered the London market in 2000 through a merger with IP boutique Needham & Grant.