Toronto, (Agencies): With an aim to create a new global mega bourse, the Toronto Stock Exchange which is the third largest in North America, is set to merge with the London Stock Exchange.

The TMX Group, which operates the stock exchanges in Toronto and Montreal, said on Tuesday that "it is in discussions with London Stock Exchange Group regarding a possible merger of equals to create an international exchange leader.''

The 150-year-old Toronto Stock Exchange is the biggest resource (energy and mining) leader, with about 1,500 companies listed on the bourse.

Though the the world's largest mining companies are listed on the London exchange, the TMX hogs most junior mining firms.

When the current market value of the London Stock Exchange (LSE) is about $3.87 billion whereas the TMX Group is pegged at $2.99 billion, with their merger, the two bourses will form a nearly $7-billion giant entity with offices in Toronto and London.

The TMX's merger decision has been driven by similar moves by other major bourses to form mega bourses - as did the Singapore and Australian exchanges recently - to attract more corporate listings and thus make more money.

The two exchanges, which have been in merger talks for about a month, will create one of the world's biggest resource bourses at a time when resources are becoming much sought after.

With alternative trading systems shrinking its market share, the Toronto Stock Exchange owner TMX Group also explored the possibility of a merger with NYSE, but their talks failed.

Nasdaq was also eager to form an alliance with the TMX Group, but the latter was not interested in it. The LSE also reportedly rebuffed Nasdaq.