Euronext is still expected to make a play for LSE

Euronext said it had dropped the idea, announced before it made its interest in the LSE known, at the same time as it unveiled forecast-beating profits.

Instead, it has made a joint offer with Borsa Italiana for bond market MTS.

Full-year net profits rose to 147m euros ($201m; �105m) the company said, up from 56m euros in the previous year.

Euronext operates the Amsterdam, Paris, Brussels and Lisbon bourse.

Rivals gather

The Paris-based exchange had originally planned to set up a rival trading platform for UK shares in response to the LSE's decision to begin trading Dutch shares in competition with its Amsterdam bourse.

But it has not been a smooth run for the LSE, which is expected to miss its ambitious target of winning 30% of the Dutch market within a year.

Last month, Euronext said it had designs on the LSE, but has yet to launch a firm offer despite the withdrawal of a �1.3bn bid by rival suitor Deutsche Boerse.

The London bourse has long been eyed by Borsa Italiana as a potential partner but now has teamed up with Euronext to bid for MTS, 46% of which is owned by Italian banks and 54% by foreign banks.

The electronic bond market also has rival bids from Deutsche Boerse as well as the Chicago Board of Trade, data group Thomson and private equity group Carlyle.

"We hope to be selected," said Euronext chairman Jean-Francois Theodore.