THE board of Deutsche Börse has announced significant concessions in its attempt to merge with Euronext, the operator of four continental exchanges including Paris.

The German exchange’s initial offer, which valued Euronext at a little above €8 billion (£5.5 billion), was rejected by the latter’s board, which prefers an agreed merger with the New York Stock Exchange.

It had been seen as a straight takeover in which control of Euronext would transfer to Frankfurt. However, after a board meeting last night the Germans came out with a fresh set of proposals that they say would mean the emergence of a federal structure, with power devolved to the various constituent exchanges. As well as Paris, Euronext operates the Lisbon, Amsterdam and Brussels markets and Liffe, the London financial futures market.

The Börse said that the financial terms, a mixture of cash and shares, remained unchanged. Yet a statement said that share-price movements since the terms had been announced meant that it was now more valuable than the NYSE offer.

Euronext had no immediate reaction to the new proposals and has a duty to its shareholders to consider them, but it is expected that the board, led by Jean-François Théodore, the chief executive, will continue with the American approach. “At the moment we’re signed up to New York,” one adviser said. Several French politicians have indicated that they would prefer a Paris-Frankfurt merger to a deal with the Americans.

The Börse is now in a position to put its terms directly to Euronext shareholders, allowing them to choose between the bids. French institutions account for little more than a fifth of the shares and are heavily outnumbered by American and British investors.

The latest German offer proposes:

The Borsa Italiana in Milan, which is already negotiating to join Euronext, would be brought on board shortly.

The NYSE initially approached Euronext after it had failed to agree a deal with the London Stock Exchange. Instead, the LSE is more than 25 per cent owned by the rival New York exchange Nasdaq, which has had its own bid approach rebuffed. Over the weekend John Thain, the NYSE chief executive, raised the prospect of starting up his own London operation to compete with the LSE, if a merger with Euronext did not deliver expected new business listing firms coming to market.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive