The London Stock Exchange today unveiled a deal to merge with Canada's TMX in a move creating one of the world's biggest trading platforms.
The proposed tie-up with TMX, which operates the Toronto Stock Exchange, will make the new business a dominant player for mining company listings at a time of surging commodity prices.
It will have its headquarters in both London and Toronto and current LSE chief executive Xavier Rolet will continue in the role for the merged group.
While the combination has been presented as a merger of equals, existing LSE shareholders will hold 55% of the enlarged business.
With more than 6,700 listings, the group will be the world's largest exchange by numbers of companies traded, with an aggregate market capitalisation in the region of £3.7 trillion.
The groups, which entered into a strategic partnership in March 2009, confirmed last night that they were in talks over a merger and unveiled the terms of the deal in a stock market announcement this morning.
Subject to shareholder and regulatory approvals, the merger is expected to be completed in the second half of this year.
The move comes at a time of consolidation among the world's bourses after the Singaporean and Australian stock exchanges announced plans to merge.
Both companies have benefited from the commodities boom as TMX claims to be the world's leading resources market while around a third of the companies on London's FTSE 100 Index come from the mining and energy sectors.
Mr Rolet said: "This is an incredibly exciting merger with considerable growth opportunities."
TMX chief executive Thomas Kloet said Canadian customers will benefit from access to deeper pools of capital, while European firms will have an effective gateway to North American financial markets.
"This merger brings together talented market professionals across a wide geography," he added.
LSE shares jumped 8% following the announcement, giving the company a market value of £2.6 billion.
As well as the Toronto Stock Exchange, TMX operates the Montreal Stock Exchange and the Calgary-based TSX Venture Exchange for small and early-stage companies.
The companies expect to realise annual savings of £35 million by the second year of the merger, equivalent to around 8% of the combined group.
The London Stock Exchange merged with Borsa Italiana in 2007 and, as a result of today's deal, Milan will become the new centre for the merged group's fixed income business.