MEXICO CITY, Dec 13 - Shares of Mexican telecoms firm Megacable and broadcaster Grupo Televisa jumped on Tuesday after Reuters reported that Televisa wants to merge the firms' pay TV and broadband operations.

Megacable shares surged 14.8% in the morning before dipping slightly. Shares of Televisa, Mexico's largest broadcaster, also rallied 10.75%, rebounding from a more than 19-year low.

Televisa wants to merge its cable and broadband unit Izzi with its smaller listed rival Megacable, according to an offer letter, Reuters reported exclusively on Monday. Megacable has not accepted the proposal first made roughly a month ago, a source with knowledge of the offer said.

Research consultancy Actinver said the potential merger was positive for both companies.

"This news kills two birds with one stone: unveiling cable's business real valuation while easing competitive concerns in the sector," the firm said in an analyst note.

Analysts from local bank Banorte said the potential merger would allow Televisa to strengthen the cable business as a leading operator and predicted the company might eventually divest its satellite television unit Sky.

"Televisa would possibly take the opportunity to sell its stake in Sky, a business that has faced significant challenges in recent quarters," Banorte analysts said in a note.

A spokesperson for Televisa declined to comment. A representative for Megacable did not reply to a request for comment.

Televisa acknowledged in its letter the transaction would be subject to regulatory approvals, though it was unclear whether the combination would face antitrust scrutiny.

On the competition front, the firms would still hold less than 11% of the total Mexican telecoms market, industry data showed, which could help the companies make the case for regulatory approval, according to an analyst who declined to be named because he was not authorized to speak.

Mexico's telecoms law says mergers must result in a market participation of less than 20% of the broadly defined telecoms sector including mobile phone, broadband, pay TV and other areas, the analyst said.

The IFT, Mexico's telecoms regulator, declined to comment.

Televisa's stock-for-stock offer would result in Megacable's shareholders owning about 45% of the merged company with Televisa at about 55%, according to the offer letter dated Nov. 14.

Televisa would also offer Megacable shareholders a 14.8 billion peso ($756.02 million) special dividend at the deal's close that would either be financed by third-party lenders or its own cash on hand, the letter said.

($1 = 19.5761 Mexican pesos) (Reporting by Cassandra Garrison; Additional reporting by Noe Torres; Editing by Josie Kao)