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While shareholders of the German exchange will control 60 pct of the new company and 10 of 17 board seats, there are suspicions in Germany that NYSE management will be in the driver's seat. There are also concerns in the United States that the New York Stock Exchange will lose influence and independence.

That tension could raise obstacles to regulatory approval of the deal, which values the two-century-old icon of American capitalism at about $39 a share.

No name has yet been given to the combined group. NYSE Euronext Chief Executive Duncan Niederauer, who will have the same title at the combined group, said talks were continuing to find a name that would address political concerns on both sides of the Atlantic.

Niederauer acknowledged at a news conference that the name of the new company would be an "emotional decision" for everyone involved. He said he hoped to give the board some name possibilities in a month or two.

Reto Francioni, CEO of Deutsche Boerse, will become chairman of the combined companies. He argued at a news conference that the deal, which he said "reshapes our entire industry," would strengthen the roles of both New York, as the financial capital of the world, and Frankfurt, as a European financial capital.

Still, U.S. Senator Charles Schumer, who first raised the name issue over the weekend, has been insisting that NYSE should come first in the name of the group, which will have headquarters in both New York and Frankfurt.

Schumer reiterated those concerns after the deal was announced on Tuesday, calling the NYSE a "preeminent brand" and saying there was no reason for it not to come first in the name chosen for the combined companies.

The combined entity will have more than $20 trillion in annual trading volume, and operations in the United States, Germany, France, Britain, Amsterdam, Portugal and Belgium.

Under the terms of the deal, each NYSE Euronext share will be exchanged for 0.47 share in the new company; Deutsche Boerse shares will be swapped on a one-for-one basis, the companies said in a statement.

A source familiar with the deal said 55 percent of the shareholders in the new company will be from the United States, with 11 percent from Germany, 11 percent from the UK and 23 percent from the rest of the world.

The exchanges face intense competition in their traditional stock-trading business from younger trading venues geared toward today's increasingly dominant high-speed electronic traders.

NYSE -- created by brokers and merchants who met under a buttonwood tree in lower Manhattan -- is one of several exchanges that have responded by investing in technology and moving into more profitable derivatives trading.

But the Big Board's once dominant market share in U.S. equities trading has steadily dwindled in recent years, and NYSE Euronext shares are down 61 percent since early 2007, compared with an 8.3 percent drop in rival Nasdaq OMX.

"This merger -- if approved -- creates a true thousand-pound gorilla," said Herbie Skeet, analyst at exchange consultancy Mondo Visione. "The new entity will be a global powerhouse, which will dominate derivatives trading in Europe and be a major force in U.S. and European cash equities trading."