Stannous chloride (SnCl2) is a good reducing agent. It reduces mercuric chloride (HgCl2) to white ppt. of mercurous chloride (Hg2Cl2) and then reduces Hg2Cl2 into grey ppt. of mercury. The following reaction takes place in two steps. SnCl2+HgCl2⟶SnCl4+ white ppt. Hg2Cl2↓ SnCl2+Hg2Cl2⟶SnCl4+ grey ppt. 2Hg↓
Therefore, addition of SnCl2 to HgCl2 gives white ppt. turning to grey ppt.