LONDON (Reuters) - Shares of London Stock Exchange Group (>> London Stock Exchange Group Plc) shares rose as much as 3.6 percent in a spike in volumes in the minutes following the EU's decision to block its merger with Deutsche Boerse with traders citing talk that a possible counteroffer from a U.S.-based exchange may emerge.

EU antitrust regulators vetoed the proposed 29 billion euro ($31.28 billion)merger between Deutsche Boerse and the LSE saying the combination would have created a de facto monopoly in the markets for clearing fixed income securities.

The risk that regulators block the deal rose significantly after the LSE decline to sell its MTS Italian trading platform which would have allayed concerns.

In a statement following the EU decision, the LSE said its proposed sale of LCH SA to Euronext N.V. will also be terminated and the company would initiate a 200 million pound share buyback.

LSE shares were last off their highs but still up more than 2 percent. Euronext shares were up 0.6 percent to a day high while Deutsche Boerse shares were up 0.4 percent.

(Reporting by Alasdair Pal, Editing by Vikram Subhedar)