Germany's Deutsche Boerse has expressed renewed interest in creating a tie-up with rival stock exchange, Euronext.
Francioni said the new exchange would not need to be in Frankfurt
Deutsche Boerse's decision comes as it indicated it would abandon any plans to bid for the London Stock Exchange.
The Frankfurt based exchange said it "welcomed" Euronext's interest in a merger and was focusing on creating a truly European exchange.
The move follows the surprise £2.4bn ($4.3bn) bid launched last week for the LSE by US market giant Nasdaq.
The renewed interest between the two European exchanges comes as the UK Competition Commission said it would permit a renewed bid from Euronext for the LSE.
"Deutsche Boerse is looking forward to enter into concrete negotiations with Euronext management on realising a combination of the two groups on the basis of a merger of partners," the German exchange said.
By doing so, the two could "create a global market leader in the industry", Deutsche Boerse added.
Euronext operates exchanges in Paris, Amsterdam, Brussels and Lisbon, while Deutsche Boerse runs the Frankfurt market.
The fresh talks mark a return to the negotiating table for Deutsche Boerse and Euronext, after discussions foundered at the end of last year.
At that time, the key sticking points included an inability to agree on where the merged firm would be based.
Deutsche Boerse's chief executive Reto Francioni had previously insisted the new exchange should be located and regulated in Frankfurt, a condition Euronext chief Jean-Francois Theodore had rejected.
Since then, however, Mr Francioni has backed away from this demand.
Pressure from traders, investors and issuers to reduce transaction costs - especially in clearing and settlement - makes a merged European exchange increasingly attractive.
German Chancellor Angela Merkel and French President Jacques Chirac have expressed support for the idea of a merger.
The creation of a European stock exchange could increase the chance of a merger between the LSE and a US exchange.
Earlier in March, the London Stock exchange received a surprise £2.43bn ($4.2bn) bid from the New York-based exchange Nasdaq.
The LSE rejected the 950 pence share offer saying it undervalued the firm.
Nasdaq's chief executive could visit London as early as this week to meet LSE shareholders for further discussions, reports say.
Consolidation between stock exchanges in Europe has accelerated over the past five years.