While the takeover battle between the NASDAQ and the London Stock Exchange rages on, the lesser-known American Stock Exchange (AMEX) has hired Morgan Stanley to begin the process of demutualization, presumably setting the stage for an initial public offering (IPO). The IPO comes after numerous exchanges/trading companies have gone public in recent years including the Chicago Mercantile Exchange, New York Stock Exchange and, regrettably, Refco.

The AMEX is definitely the least-respected of the major exchanges. I once mentioned a company to an older stock broker friend and asked him what he thought of the company. The first thing he said was "Ah! The AMEX! That's where bad stocks go to die." The AMEX will also continue to face competition for listing from the OTC market and even the Pink Sheets, where it is taking steps toward greater transparency and scrutiny of companies, perhaps setting the stage for a better reputation. The Pink Sheets is widely known as a great place to find penny stock pump and dumps.

In addition, the high costs of Sarbanes-Oxley will, in my opinion, lead more companies to seek private funding, leading to fewer IPO's in the future. The AMEX may do great, but it's not an IPO I'll be buying into.

Before coming on board the NYSE Group as CEO, John Thain was a bigwig at Goldman Sachs. Well, he certainly learned the skills of dealmaking there and he's applying them to his current gig.

This week, the shareholders of Euronext NV approved a merger with the New York Stock Exchange. The transaction amounts to about $14.6 billion.

This is unprecedented, and creates a trans-Atlantic exchange which will trade stocks with a combined value of $25.8 trillion. Of course the integration will not be easy since cross-border deals are rarely smooth.

But in a recent interview on CNBC, Thain was confident.

It looks like the merger momentum is going to continue into 2007. Thain said he is looking to Asia for consolidation, perhaps even merging with the Tokyo Stock Exchange. The two parties have already begun having some discussions.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates DealProfile.com.