Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Barnes & Noble (NYSE: BKS) surged more than 15% in early Monday trading on news that Borders Group (NYSE: BGP) and activist investor Bill Ackman may team up on a bid for the book retailer.

So what: In a regulatory filing, Ackman and his Pershing Square hedge fund said they'd be willing to back a Borders-led takeover of its bigger book foe at roughly $16 per share, representing a 21% premium to Barnes & Noble's Friday closing price. Book retailers continue to suffer in the face of ever-increasing electronic competition from the likes of (Nasdaq: AMZN) and Apple (Nasdaq: AAPL). Wall Street seems to be applauding the deal as a catalyst for some very much-needed synergies.

Now what: With Barnes & Noble and Borders both up huge this morning, it might be the perfect time to jump entirely out of the book retailing space. While combining the nation's two largest bookstores may create some cost-saving synergies, the secular decline of paper books just seems too powerful to overcome. Unless you're convinced that the potential combo will somehow create a formidable opponent against the e-book gorillas, it's best not to read too much into today's news.

Interested in more info on Barnes & Noble? Add it to your watchlist.

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Amazon and Apple are Motley Fool Stock Advisor selections. The Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days.

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