Ameritrade may be wrapping up a deal in which it will purchase TD Waterhouse. The New York Times reports that the two discount brokers were close to a deal Sunday night. The talks between the two firms have been reported for the past month.

The deal would be valued at more than $3 billion.

A deal would make Ameritrade the largest discount broker and make it a stronger rival to Charles Schwab, which no longer considers itself a discount broker. Yet, how large an impact the deal would have on the fund business remains to be seen. TD Waterhouse has batted Schwab in the advisor market for the past half decade, but has remained well behind its San Francisco-based rival. Ameritrade only started offering custody services to advisors in the past three years and remains well behind both Schwab and TD Waterhouse.

While the firm's are best known to the public as discount stockbrokers, much of the sales volume for funds is driven by advisors who use their platforms to manage client assets.

Under the reported terms of the deal, Ameritrade would merge operations with TD Waterhouse. Meanwhile, Toronto-Dominion would keep acquire a one-third stake in Ameritrade. Stockholder would also receive a special dividend of an undetermined value. 

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