Pan-European bourse operator Euronext is due to present a merger blueprint to London Stock Exchange today and exploit growing disquiet over Deutsche Boerse's own plan to take over the London market.
Euronext Chief Executive Jean-Francois Theodore will discuss with his LSE counterpart Clara Furse issues such as business fit, integration, corporate governance, regulation and competition, a source familiar with the situation said.
The meeting comes a day after Deutsche Boerse held similar talks with Furse.
Last month the Frankfurt exchange made a 530 pence per share offer for Europe's biggest equity market, valuing it at £1.3 billion pounds sterling. LSE rejected the initial offer but left the door open for talks, effectively triggering an auction.
Euronext and Deutsche Boerse have yet to make formal offers, and sources close to the process said such a step could still be weeks away.
Thursday's talks between Deutsche Boerse and LSE came against a backdrop of mounting German political opposition to the market operator moving its headquarters to London.
Deutsche Boerse's takeover ambitions were further criticised by Chris Tupker, Chairman of pan-European settlement house Euroclear.
Although not naming Deutsche Boerse, Tupker said in a letter to the Financial Times on Friday that LSE shareholders should question if it was appropriate that trading, clearing and settlement functions become a monopoly in the hands of a company driven by the goal of maximising shareholder profits.
Deutsche Boerse owns its clearing and settlement houses, giving it a vertically integrated business model.
LSE and Euronext do not have control over their clearing and settlement operations, a situation many big banks believe is more transparent and competitive.