London Stock Exchange, Deutsche Boerse discuss merger

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The London Stock Exchange Group says it is holding discussions with Deutsche Boerse over a potential merger.

In a statement Tuesday, it said Deutsche Boerse shareholders would hold 54.4 percent of the merged company. However, the merged entity will have a board composed of an equal number of LSE and Deutsche Boerse directors.

Under the proposed terms, LSE shareholders would get 0.4421 shares in the new company for each LSE share they hold. Deutsche Boerse shareholders would be entitled to receive one new share in exchange for each Deutsche Boerse share they hold.

The proposal is the third time the two companies have tried to merge. The previous efforts in 2000 and 2004 collapsed.

LSE shares surged 16 percent on the news while Deutsche Boerse shares were up 6 percent.