Publisher Informa has confirmed its is considering an all-share merger with United Business Media (UBM) after press speculation at the weekend.
Shares in Informa rose 11.33 per cent by midday on the London Stock Exchange (LSE) while UBM stock climbed 1.9 per cent.
The Sunday Telegraph revealed the tie-up yesterday, valuing the deal at £3 billion.
A merger between the two FTSE 250 companies would propel the new entity into the FTSE 100 index.
"The board of Informa is considering the proposal and is in preliminary discussions with UBM. There can be no certainty that any transaction will take place," the company said in a statement.
UBM, which distributes news through PR Newswire and publishes journals such as Property Week said discussions are "at an early stage".
Informa shares have fallen following the £502 million takeover of market research group Datamonitor last May, as the company had to take on a high amount of debt to fund the acquisition.
Informa has recently been targeted for takeover itself and turned down an offer from private equity-owned Springer Science and Business Media at the end of 2006.
If the deal goes ahead, it is thought that Informa's chief executive Peter Rigby could become chairman, while UBM's David Levin could be chief executive.
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