Nasdaq OMX Group is closer to making a counter-bid for NYSE Euronext, a source familiar with the situation said, a move that would challenge the Big Board's blockbuster deal with Deutsche Boerse by merging two of Wall Street's fiercest rivals.

Under the offer being contemplated, the Nasdaq Stock Market parent would finance the transaction with up to $5 billion in debt and sell NYSE Euronext's Liffe derivatives business to IntercontinentalExchange, the source said.

An offer could come as early as this week, the source said.

Bringing Nasdaq and the New York Stock Exchange parents together would create a stock-trading powerhouse in the United States and Europe that would also dominate the business of listing US public companies, and dwarf other US options markets.

If successful, such a counter-offer would redraw the global exchange map and thwart yet another merger plan by Germany's Deutsche Boerse. It would be a bold move by Nasdaq chief executive Robert Greifeld, who has a mixed deal-making record.

ICE, an Atlanta-based futures specialist, would meanwhile nab London's Liffe platform - a profitable gem that would give chief executive Jeffrey Sprecher an interest-rate business that eluded him when ICE's bid for the Chicago Board Options Exchange failed four years ago.

Any bid would follow weeks of speculation that Nasdaq - seen as the odd man out of a global mergers frenzy among exchanges - would jump into the fray.

But with the deals driven largely by a need to diversify and ramp up profitable derivatives trading, such a move by Nasdaq to expand in its core, low-margin, stock-trading business could raise questions for shareholders.

"I would be shocked if this happened," Sang Lee, managing partner specializing in market structure at Boston consultancy Aite Group, said of a possible Nasdaq-NYSE tie-up.

"If the game is to create a viable, long-term business that can compete globally, doing something like this is probably a step backward," he said.

Nasdaq, NYSE, and Deutsche Boerse declined to comment. ICE was not immediately available for comment. The source declined to be named because the talks are not public.

A source familiar with the situation told Reuters last month that Nasdaq was exploring options that include teaming up with a partner like ICE on a rival bid for NYSE.

Reuters