The head of pan-European stock market operator Euronext yesterday invited the Tokyo Stock Exchange to form a three way tie-up with the New York Stock Exchange to offer seamless trading across three continents and the world's largest economies.
Jean-Francois Theodore, chairman and chief executive of Euronext NV, which runs the Paris, Amsterdam, Brussels and Lisbon bourses and is merging with the NYSE, said his first goal was to bring other European exchanges under one roof.
The next phase would be to seek an Asian partner and the TSE was the logical candidate, he said.
"Both Euronext and the New York Stock Exchange have the best relations with the Tokyo Stock Exchange," Theodore told a finance conference in Tokyo.
"The Tokyo Stock Exchange has started a new plan for development and in due time it will be up to the Tokyo Stock Exchange to look at consolidation on its side," he added.
The Tokyo Stock Exchange said last month that it was discussing a tie-up with the NYSE, which in June announced a US$10 billion merger with Euronext to create the world's first intercontinental market
Asia's largest bourse is also in talks with the London Stock Exchange about a possible operational partnership but says that for now, it remains focused on bolstering its own trading system to achieve a successful listing in 2009.
The TSE has had a disastrous year. It suffered its worst-ever system crash last November which forced it to shelve listing plans.
World stock exchange operators are linking arms to facilitate easier cross-border trading while boosting their own competitiveness.
Theodore said further consolidation among world exchanges was inevitable to meet client demands.
"What stock exchange operators have to do now is offer the best trading conditions in terms not only of cost but also efficiency and to enlarge the pool of liquidity," he said.