Source: Media General.

What: Shares of TV station manager Media General (NYSE:MEG) jumped as much as 27% higher on Monday morning. Industry peer Nexstar Broadcasting (NASDAQ:NXST) provided fuel for the rocket boost, launching a takeover bid for Media General that would value the stock at roughly $14.50 per share. Nexstar stock was up less than 1% as of 12:30 p.m.

So what: Nexstar's cash-plus-stock offer works out to a $4.5 billion deal, including Media General's $2.1 billion net debt balance. This merger of equals would create a broadcast-focused giant with 162 TV stations in 99 media markets. More to the point, Nexstar wants to stop Media General from completing a similar deal with Meredith.

Now what: Compared to the Meredith deal, the Nexstar combination would roughly double Media General's TV station and media market reach. It would become the nation's second-largest portfolio of network affiliates, while Meredith would only put the new company in third place. Nexstar underscored the economies of scale and fortified negotiating leverage that would result from a larger footprint.

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Nexstar offered to buy Media General for $17 a share last month, in private discussions with Media General's leadership. But that offer was turned down, and Nexstar claims to have had no knowledge of the Meredith negotiations which must have been under way at the time.

Media General quickly confirmed Nexstar's offer, but refrained from taking any official position on the proposed deal. The board will review Nexstar's terms before offering any further guidance, other than asking shareholders to "take no action" in the meantime.