The New York Stock Exchange (NYSE) yesterday reached an agreement to buy the Paris-based European exchange Euronext for €7.78 billion (£5.35 billion).
The deal, described as a "merger of equals" by the two groups, will create the world's first transatlantic stock exchange valued at around €15 billion (£10.3 billion).
Euronext shareholders will be given the opportunity to exchange each of their shares for 0.98 shares in the new company and €21.32 (£14.67) in cash.
The merged company will be renamed NYSE Euronext and have its US headquarters in New York, while its international business will be based in Paris and Amsterdam.
London will be the centre for the new company's derivatives business.
Current NYSE chief executive John Thain will head the merged group, while Euronext chief Jean-Francois Theodore will become deputy chief executive with responsibility for European business.
Commenting on the proposed merger, Mr Thain said in a statement: "A partnership with Euronext fulfils our shared vision of building a truly global marketplace with great breadth of product and geographic reach that will benefit all investors, issuers, and our shareholders and stakeholders."
Mr Thain warned that while regulators in France and the United States were supportive of the potential merger, the proposed deal with Euronext could take six months to complete due to regulatory issues.
Shareholders from both companies will also have to approve the merger, with Euronext investors last month rejecting offers from both the NYSE and its rival Deutsche Bourse.
Analysts are predicting further merges between global stock exchanges as companies seek to cut costs and increase client numbers.
Earlier this year the London Stock Exchange (LSE) rejected a takeover offer by the US stock market Nasdaq, which has subsequently increased its stake in the exchange to more than 25 per cent.