NYSE Euronext shares fell over 10% on the news, which came despite Nasdaq proposals to sell off parts of the NYSE Euronext portfolio. The shares are now trading at $37.76 a share, around the level of the Deutsche Börse bid.

Bob Greifeld, NASDAQ OMX CEO said: “We took the decision to withdraw our offer when it became clear that we would not be successful in securing regulatory approval for our proposal despite offering a variety of substantial remedies, including the sale of the NYSE SRO and related businesses.”

The surprise withdrawal from Nasdaq and ICE leaves Deutsche Börse firm favourites to win control of the exchange.

Jeffrey C. Sprecher, ICE Chairman and CEO, said: “We appreciate the strong support of our investors as we made an opportunistic and disciplined move to pursue an attractive combination that would preserve competition in the European derivatives markets. 

“I also want to acknowledge the consideration shown by NYSE Euronext stockholders for our joint proposal, which was undertaken with seriousness and a concern for the evolving global market structure. We will continue to seek opportunities that benefit our customers and stockholders, and that leverage our unique global market infrastructure in commodities, derivatives and clearing.”