Deutsche Boerse AG (DB1.XE) and NYSE Euronext (NYX) on Tuesday outlined plans for a combination that would create the world's largest exchange operator if it can win support from regulators and lawmakers and overturn investor skepticism about forecast synergies.

The companies aim to close a transaction by year end, though they said it could take up to 60 days to choose a name for a combined entity in which Deutsche Boerse shareholders would own 60%. Though billed as a merger of equals, the all-stock proposal offers NYSE Euronext shareholders a 10% premium to its undisturbed share price.

The enlarged exchange would create a dominant force in listed European derivatives and clearing and challenge CME Group Inc. (CME) in the U.S. and for expansion opportunities in Asia.

Speculation continued to swirl that the Chicago exchange could launch a spoiler bid with Nasdaq OMX Group Inc. (NDAQ) and split NYSE's derivatives and equities business between them. CME said in a statement it remained focused on organic growth.

The latest planned deal joins two other combinations amid the latest flurry of industry deal-making, notably the planned mergers of Toronto's TMX Group (X.T, TMXGF) and the London Stock Exchange Group PLC (LSE.LN), and Singapore Exchange and Australian market operator ASX Ltd. (ASX.AU).

"This is an industry that lends itself to scale, more than any other industry any of us have thought about, covered or seen," said NYSE Euronext chief executive Duncan Niederauer at a press conference following the announcement, pointing to potential future cooperation with Asian exchanges..

Niederauer would retain the position in the merged entity, with fellow executives holding half of the key roles on an eight-member management committee that aimed to navigate the political sensitivities about a German company taking over the iconic parent of the Big Board.

He said discussions with competition officials wouldn't be easy, though saw regulatory issues largely confined to Europe. Reto Francioni, his opposite number at Deutsche Boerse, said early signals from regulators were "positive," though it is expected to trigger a filing with the Committee on Foreign Investment in the U.S., as well as scrutiny from antitrust officials on both sides of the Atlantic.

The plan first leaked last week is the sixth attempt by Deutsche Boerse to close a transformative deal in as many years, including two prior efforts to tie with NYSE Euronext, and the companies said it would be accretive to both from the outset.

Niederauer said most planned cost savings--seen running at an annualized $400 million three years after closing--would be from harmonizing technology and clearing services. They also see gains from cross-selling products.

The boards of both companies approved the proposed deal at meetings earlier Tuesday.

Francioni would be chairman of the Amsterdam-based holding company, with Deutsche Boerse contributing 10 members of a 17-strong one-tier board.

An executive committee will be led by Niederauer with four members representing each exchange. From Deutsche Boerse, Andreas Preuss will become deputy CEO and president as well as head of derivatives. Gregor Pottmeyer will become chief financial officer, Jeffrey Tessler will lead settlement and custody operations, Frank Gerstenschlaeger will lead the company's market data and analytics operations.

Key board members from NYSE Euronext will include Dominique Cerutti as head of technology services and IT, Lawrence Leibowitz, who will head cash trading and listings and John K. Halvey, who will become general counsel.

Joint headquarters will be located in New York City and Eschborn, near Frankfurt.

The Deutsche Boerse-NYSE Euronext proposal calls for one of the German group's shares to be exchanged for one share of the new company's stock, while each share of the Big Board owner will be swapped for 0.47 share of the new company stock.

NYSE Euronext shares were recently down 3% at $38.25, with Deutsche Boerse off 2.4% at 59.85 euros. CME shares were down 2.1% at $296.16 amid a broad sell-off in the exchange sector.

   -By William Launder, Jacob Bunge and Doug Cameron, 
   Dow Jones Newswires; william.launder@dowjones.com

--Nathan Becker contributed to this article.
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