Media General announced an agreement Friday to acquire LIN Media for $2.6 billion, a deal that will make it the United States' second-biggest local TV broadcast company.

LIN Media shareholders will receive $763 million in cash and 49.5 million shares of Media General stock; including LIN's net debt balance, the transaction value is $2.6 billion.

The combined company will have 74 network-affiliated owned or serviced TV stations across 46 markets and potentially reach 26.5 million, or approximately 23 percent, of U.S. TV households.

The transaction is part of a wave of consolidation over the past year in the local TV broadcast industry, with companies seeking economies of scale to overcome a loss of market share and advertising revenue amid the rising popularity of cable and Internet channels.

Tribune Co became the United States' largest local TV broadcast company by acquiring 19 channels from Local TV Holdings for $2.73 billion last July, a month after Gannett Co purchased Belo, with 20 TV stations and three radio outlets, for $1.5 billion.

Shares of Rhode Island-based LIN Media were up over 21.5 percent on the New York Stock Exchange after midday, while shares of Virginia-based Media General initially shot up more than 12 percent but were around 3 percent higher than Thursday's closing price shortly after 1:00 p.m. EFE