The merger, which will take effect from April 1, 2007, will bring Irwin Mitchell's 1900 staff and Golds' 400 under the one firm, to be known as Irwin Mitchell.
With more than 2300 staff, the newly-merged firm will also be the fourth-largest law firm by number of fee earners - more than 1200 - in the UK, with an office network covering Birmingham, Glasgow, Leeds, London, Manchester, Newcastle, and Sheffield, and the Spanish cities of Marbella and Madrid.
Golds, founded in 1981, is Scotland's leading volume supplier of mortgage lending, commercial lending and recovery services to financial institutions, and for several years has been Scotland's largest provider of commoditised services in the insurance sector.
As well as being big in insurance services in England, Manchester-based Irwin Mitchell is also the leading personal injury and medical negligence litigation practice in the country.
It has been involved in numerous high-profile cases from the Selby train crash to the current legal action involving Alice Mahon, the former Labour MP for Halifax, and her fight to force her local Kirklees Primary Healthcare Trust to prescribe the eye drug Lucentis in order to save her sight.
Mark Higgins, Gold's head of litigation, said: "This is a true merger. Both firms have market-leading reputations in different, but closely-related markets, and have co-operated closely over a number of years.
"The new firm will be able to provide a cross-jurisdiction service to all our clients."
Howard Culley, managing partner at Irwin Mitchell, said: "This mergerwill create a legal powerhouse offering our clients an unequalled diversity of legal services whilst providing the firm with a springboard to develop commercial work with financial institutions.
"The mergerwill also create a base to promote our marketleading personal injury and clinical negligence services in Scotland."
The merger is designed to take full advantage of the changes taking place within the legal industry, he added.
"The present government has been clear in its intention to streamline the delivery of legal services, increase competition within the UK's legal sector and ensure that a better legal service is provided to consumers.
"Irwin Mitchell has supported the proposed changes to the legal industry set out in the legal services bill.
"Realising the opportunities that a deregulated market will offer, our aim has been to position the firm as the leader in the delivery of volume legal services in the UK whilst continuing to develop our specialist areas of practice."
Both firms have developed a pioneering range of "white label" legal products for national organisations, institutions and companies which can be packaged and sold under their own brand.
These products include Irwin Mitchell's innovative law support product which provides tailored legal services for the employees and/ or customers of major businesses, and Golds' pioneering outsourcing work for major commercial lenders.
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