The clients of both agencies are being sounded out about a possible marriage in advance of a probable announcement early next week.
The Bozell operation in New York is increasingly seen as an anomaly within Interpublic, and its absorption would provide Lowe with some vital critical mass.
At the same time, the merger is being seen as a way of achieving cost savings for Interpublic, which is under heavy pressure to reduce its $2.9 billion debt.
The Bozell office in New York suffered a blow recently with the resignation of its creative director and managing partner, Tony Granger, who is to replace Dave Droga as the creative chief of Saatchi & Saatchi in London.
"It's a shame because Granger is very talented and ran a good department," a Lowe source said. "He would have been a great asset to us."
The Bozell agency in New York was retained as a standalone operation when the FCB and Bozell global networks were merged in 1999. This was in order to resolve a number of domestic client clashes, particularly Bozell's $167 million Bank of America and FCB's Chase Manhattan Bank business.
Bank of America presents Interpublic chiefs with a significant conflict problem to resolve because Lowe already handles HSBC.
Bozell is the second long-established US agency brand to disappear in recent months - D'Arcy is currently being killed off and dismembered by its parent company, Publicis Groupe.