The London Stock Exchange Group (LSE) and Germany’s Deutsche Boerse agree terms on a «merger of equals».

The tie-up will create one of the largest exchange companies in the world with a combined value of about £21bn.

Under the terms of the deal, LSE shareholders will own 45.6% of the new holding company, while Deutsche Boerse shareholders will own 54.4%.

LSE chief executive Xavier Rolet said the two firms were «creating an industry-defining combination».

The two companies said together they should be able to make cost savings of €450m (£354m) a year, about 20% of the combined group’s operating costs of €2.2bn last year.

The LSE group already owns Milan-based Borsa Italiana.