A combined firm would employ around 900 staff, including 150 partners, and see a fee income of more than £75 million.
A joint statement issued by the firms said: “Each firm excels in distinct sectors with little overlap, making a neat fit between the two.
“There is real synergy in the two firms and an expectation that prospects and clients across the UK and globally will find any merged firm a compelling offering.”
Shakespeare broke through the £50 million turnover barrier for the first time in 2014, following a period of sustained growth.
Seen as one of the fastest-growing on the country 2013 saw two mergers, the first with Leicester-based planning specialists Marrons and the second with Stratford/Coventry-based social housing experts Newsome Vaughan.
SGH Martineau, a Birmingham-based firm which also has an office in London, posted full-year revenues of £27.5 million and profit of £6.8 million in 2014, which it said “exceeded expectations”.
Profits rose despite a fall in revenues, which the firm said was as a result of specialising in the sectors it is strongest in and a continued drive for efficiency.
Speaking about the merger talks Andy Raynor, CEO of Shakespeares and Emma Shipp, managing partner of SGH Martineau, in a joint statement, said: “Our firms only contemplate mergers where we believe that there may be significant benefit for our clients, our sectors, our people and our community.
“We’re in the process of confirming the benefits that a combination may bring and our working relationships to date have been friendly, positive and strong, demonstrating a shared sense of values.”