Could a three-way merger be on the cards?

The move comes despite comments from the head of Euronext that hinted that Deutsche Boerse could join the deal.

Euronext chief Jean-Francois Theodore told Le Monde newspaper "the structure is open to Frankfurt's stock exchange".

If backed by investors, the NYSE deal will create the first transatlantic stock market worth $20bn (�11bn).

Meanwhile the pressure is on for the London Stock Exchange (LSE) to ensure it is not isolated by the tie-ups.

Deutsche determined

In response to Euronext's comments, Deutsche Boerse said it would "continue to work toward a combination of the two companies" but did not mention the NYSE deal.

"A combination of the two organisations would have a significant positive impact on European financial markets," it said.

It's a historic day. We have created the first truly global market place John Thain, NYSE Check Euronext's shares

Analysts said that the NYSE-Euronext pairing left the LSE and Deutsche Bourse with a strategic problem, saying not to act could be dangerous for their futures.

Euronext was once keen on the LSE but dropped out when Nasdaq, which has built up a 25% stake in the London exchange, moved in.

"Whilst the merger does not give the NYSE direct access to either of Europe's biggest markets in London and Frankfurt, effectively it has the remainder," said Richard Hunter at Hargreaves Lansdown Stockbrokers.

"The question now is whether the LSE or Deutsche Boerse move on to the front foot to ensure defensive consolidation and, if so, how they achieve this."

Rationale

Stock exchanges globally are looking to merge as competition for business increases, fuelled by a shift into electronic trading.

A merged exchange has more appeal as traders, investors and issuers are all keen to reduce transaction costs - especially in clearing and settlement.

The LSE is somewhat sidelined by the NYSE Euronext deal, but that doesn't really matter - a lot of merger deals are done for the wrong reasons David Lascelles, Centre for the Study of Financial Innovation Read more about the battle of the exchanges

For the 214-year-old NYSE, the addition of Euronext also provides an outlet for firms which may have been put off by the extensive US regulation implemented after a series of corporate scandals.

Deutsche Boerse had made an offer for Euronext last week, but it was rejected for being too low with management saying NYSE was their preferred partner.

NYSE's $10bn cash and shares offer was described by the firms as a "merger of equals".

Under the deal, each NYSE share will be converted into one share of common stock in the merged company, to be renamed NYSE Euronext.

Euronext shareholders will have the chance to exchange each of their shares for 0.98 shares of NYSE Euronext stock and 21.32 euros in cash.

They will also receive the previously announced dividend of three euros per share.

'Important development'

Paris-based Euronext has bourses in Amsterdam, Brussels and Lisbon, runs trading and settlement in Madrid and Milan, and also operates in London with Liffe.

The merged firm will be led by NYSE Group boss John Thain, with Mr Theodore as deputy chief executive officer and head of international operations.

Mr Thain said the deal was "an important development in the history of the NYSE, Euronext and the global capital markets".

He added: "It's a historic day. We have created, for the first time, a truly global market place."

While executives from Euronext have been more positive about a tie-up with the NYSE, some have said the offer still undervalues the firm.