In a possible consolidation of the online discount brokerage business, E-Trade Financial Corp. (ET) has made an offer for AmeriTrade Holding Corp. (AMTD), according to published reports Monday. Ameritrade shares soared nearly 19 percent.

The New York Times and The Wall Street Journal, both citing unnamed people familiar with the talks, also said AmeriTrade was already in talks about a deal with a third brokerage, TD Waterhouse Group Inc. (search)

E-Trade made an unsolicited bid to buy AmeriTrade on Friday for more than $5.5 billion in a letter to its board, according to executives who spoke to the Times.

Representatives for New York-based E-Trade (search) and Omaha-based AmeriTrade (search), declined to comment to The Times, and The Journal said Ameritrade founder Joe Ricketts could not be reached for comment. The Times said a spokesman for TD Waterhouse, which is based in New York, could not be reached for comment. TD Waterhouse is owned by The Toronto-Dominion Bank.

Online brokerage firms face pressure as the stock market and trading volumes continue to be weak, never returning to the heights of day trading in the late 1990s.

In a recent research report, Michael Hecht, an analyst at Banc of America Securities, said the management of E-Trade "believes that the discount brokerage industry is ripe for consolidation and hopes to participate."

"To the extent weak equity markets put pressure on the group's economics, consolidation becomes more likely," Hecht added.

Amid fierce competition over the last several years, the commission fees that investors pay have fallen sharply, both online and off. Online brokerage firms now offer trades for as little as $8.95, and some offer 20 or more commission-free trades as an incentive to sign up with the services.

Shares of E-Trade rose 69 cents, or 5.8 percent, to close at $12.62 on the New York Stock Exchange, where they have been trading in a 52-week range of $9.51 to $15.17. AmeriTrade shares rose $2.11, or 18.7 percent, to close at $13.42 on the Nasdaq Stock Market, near the high-end of a 52-week range of $9.35 to $14.61. Toronto-Dominion Bank shares rose 50 cents to close at $41.25 on the NYSE, near the high-end of a 52-week range of $31.16 to $41.93.