NEW York stock exchange Nasdaq yesterday vowed to rid itself of the 31 per cent stake it built up in the London Stock Exchange (LSE) during a failed takeover attempt.

The group has hired advisors to help it explore options for the divestment of the £800m stake, which it acquired in a long-running pursuit of the exchange.

Nasdaq had pledged to keep the holding, but in making its disposal announcement yesterday, it noted that its own stock price did not adequately reflect the value of its stake in the LSE.

LSE shares jumped three per cent to 1305p on the back of the announcement as traders said the sale of such a large holding could trigger new takeover interest in the company.

The US exchange is prevented from making another approach for the LSE until February, a year after it conceded defeat on a £2.7bn offer because it failed to get the support of a further 21 per cent of shareholders.

The New York company's percentage holding will soon be diluted because the LSE has recently agreed a deal to buy Milan exchange Borsa Italiana in shares.

Nasdaq, which paid up to 1248p a share for its LSE holding, is currently fighting its own takeover battle after Borse Dubai launched a surprise rival bid for OMX, the Nordic stock exchange group. The move on Friday trumped an earlier agreed offer worth $3.7bn (£1.85bn) from Nasdaq.

The exchange said that about $1bn (£500m) of the anticipated LSE sale proceeds would go towards paying off debt.

It added: "There can be no assurance that the exploration of sale alternatives for the stake will result in any transaction."

Nasdaq estimated that selling the stake would increase its stand-alone earnings per share for 2008 by approximately 30 cents to 35 cents.