The Nasdaq Stock Market ( NDAQ) and the London Stock Exchange are yelling at each other again.

Nasdaq is using stronger language to prod LSE shareholders toward accepting its $5.3 billion hostile bid. But the LSE is standing its ground.

Nasdaq said Monday that by remaining independent, the London exchange "fails to acknowledge growing customer dissatisfaction, new competitive threats introduced by upcoming regulatory changes or accelerating consolidation of the exchange landscape."

A "key issue is how LSE will react to the substantial future challenges that it will face in 2007 and beyond," Nasdaq said in a press release Monday ahead of a procedural deadline Thursday. "We believe the LSE is unprepared for those challenges ahead."

For now, the LSE doesn't seem to be quaking in its boots.

"Exchange shareholders should not be persuaded into selling their shares well below their true value by Nasdaq's bluster," CEO Clara Furse said in a statement.

Nasdaq is under increasing pressure to get the London deal done as the exchange sector continues to consolidate. The New York Stock Exchange ( NYX) is set to close on its $14 billion acquisition for Europe's Euronext exchange.

The tech-heavy electronic exchange was responding to the LSE's formal rejection last month of its so-called final offer. Nasdaq had made the bid in late November, saying at the time it was willing to pay 1,243 pence per share for the London bourse.

Nasdaq was hoping to garner 90% of the shares, but after Nasdaq investors balked at the terms, the exchange now says it wants to buy just over half of LSE shares.

On Monday, LSE stock closed down a penny at 1282 pence.

Nasdaq already owns a 29% stake in the London exchange. It bought up blocks of shares of the LSE last year after an initial $4.2 billion unsolicited bid was rejected as "wholly inadequate."

Nasdaq warned that if enough LSE shareholders did not tender their shares, the LSE's stock "would be worth far less without Nasdaq and a lapsing of the final offers is likely to precipitate a substantial fall in the share price."

Rich Repetto, an analyst at Sandler O'Neill, writes in a note that the only way LSE shareholders could justify holding onto their shares is if they believe in one of three scenarios: that the intrinsic value of the London exchange is higher than the current market price; Nasdaq will increase its tender offer; or a competing offer will be made by another exchange.

"To date, it has appeared like a standoff between Nasdaq and the LSE, with each waiting for the other to blink," Repetto writes. "However, it now appears the scenario has changed and it is up to the LSE shareholders to decide on the intrinsic value of the LSE."

Repetto says he expects the LSE to "launch a second defense against the Nasdaq bid that will attempt to bolster its case for higher intrinsic value, possibly by hinting of partnerships with other exchanges/parties."

Indeed, published reports say that LSE is preparing to issue third-quarter results this week -- earlier than anticipated, according to U.K. newspaper The Daily Telegraph.

Shares of Nasdaq rose 61 cents or 1.8%, to $33.71 on Monday.

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