West Yorkshire-based Chevin Housing Association has begun merger talks with Sheffield-based Hallam Housing.
If it goes ahead, the merger would give the resulting association control over almost 7500 homes in the region.

Staff and partners in the region have been told of the pair's merger discussions, and the details of the proposal are expected to be resolved over the next few weeks.

A joint meeting to thrash out the remaining issues is slated for next month.

Chevin and Hallam have worked together before. They teamed up last December as part of the Synergy Partnership, a group of eight registered social landlords that bid to be one of the Housing Corporation's elite group of development partners. It received £26.4m in development grant from the corporation.

Chevin manages 5000 rented homes and 1000 leasehold homes across Yorkshire and Humberside, but currently has little presence in South Yorkshire. Hallam runs almost 1400 homes, the bulk of which are in Sheffield and Rotherham.

Chevin chief executive Steve Close said: "The boards are working through the proposals.

"The two associations have been looking at the benefits of working together for some time. We feel that there is a good strategic fit and our discussions have identified that, by merging, we will be better placed to make a positive difference to tenants, residents and neighbourhoods across the region."

Close said the merger would generate efficiencies in service provision and development.

The name of the merged organisation is yet to be decided.