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NYSE holding talks on acquiring rival markets

The New York Stock Exchange (NYSE), the world's largest equity market, is holding talks with rival markets about a possible acquisition, upping the stakes in the highly competitive stock trading industry.

NYSE Holdings, which operates the exchange, said in a filing with the regulatory agency -- the US Securities and Exchange Commission (SEC) -- that it has held talks with rivals over the past month.

"We are currently engaged in discussions with certain participants, although no definitive terms have been discussed or agreements reached," according to documents posted on its Web site.

The London Stock Exchange Plc (LSE) is one of the likely acquisition targets, but no further information was given, Bloomberg financial news service reported on Friday.

Just last year, NYSE members voted to merge with the Chicago-based trading platform Archipelago Holdings Inc and turn the 213-year-old institution into a public, for-profit company, a decision that sped up the shift to electronic trading for NYSE.

The move emulated developments at exchanges in London, Frankfurt, Toronto, Sydney and other European locations that are already for-profit companies competing aggressively to boost their reach and market share.

But the merger was also aimed at its own back yard, where the high tech US trading market, the NASDAQ, has bid US$4.2 billion for the LSE, Europe's largest equity market.

The offer was withdrawn after the LSE declined to discuss a potential deal, but last week, NASDAQ bought a 15 percent stake in LSE for US$781.5 million, Bloomberg reported.

"The market for acquisition targets and strategic alliances is highly competitive, particularly in light of increasing consolidation in the securities industry," the NYSE told the SEC.

"We intend to continue to engage in strategic discussions and we will need to respond to potential opportunities quickly and decisively," it said.

The ambitious plan is part of NYSE head John Thain's drive to turn the Big Board into a "global multi-product marketplace" and to battle intense competition from the technology-heavy NASDAQ market as well as European exchanges.
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