Nielsen, the market leader, was reported to be considering an offer for German firm GfK. However, David Calhoun, Nielsen's chief executive, told the Financial Times that the strengths GfK and TNS had in consumer panels and customised research were not in the "sweet spot" of his strategy.
He said: "Consolidation in and of itself I don't think is a particularly attractive prospect for us."
This boosts TNS's chances of fending of a takeover bid from Sir Martin Sorrell's WPP group, which has made two approaches to TNS in the last two weeks.
TNS rejected the second takeover bid by WPP on Tuesday night, which had valued the market research group at just under £1bn.
The TNS board said it had unanimously rejected WPP's improved offer, arguing that it "substantially undervalued" the company.
The offer, valued at around £996m, marked a 5% premium on WPP's first rejected offer of £948m, made on May 5. It was also more than a 40% premium on the group's share price from the end of April, before news emerged of the group's merger talks with GfK.
TNS is currently the world's third-largest market research firm, with GfK in fifth place. WPP owns Kantar, the fourth-largest market research group in the world, which had 2007 revenues of $1.89bn.
The merger of GfK and TNS will create a market research giant with revenues of over $3.5bn (£1.8bn), based on the 2007 revenues of the two constituent parts, which would be a stronger rival to Nielsen.