<p>AT&T Inc. is nearing a deal to acquire BellSouth Corp. for around $65 billion, according to media reports Sunday.</p><p>The companies were expected to announce the terms of the deal as soon as Monday, according to an article in The New York Times and on the Web sites of The Wall Street Journal, Atlanta Journal-Constitution and USA Today. The papers cited unidentified sources, due to the sensitivity of the negotiations.</p><p>Larry Solomon, vice president of corporate communications for AT&T, declined to comment Sunday to The Associated Press. Messages left for BellSouth spokesman Jeff Battcher were not immediately returned.</p><p>The deal would substantially expand the reach of AT&T, already the country's largest telecommunications company by the number of customers served.</p><p>AT&T was formed by San Antonio-based SBC's acquisition of AT&T Corp. in November. The deal added a substantial national reach to the former Southwestern Bell's local business, which is concentrated in 13 states, including Texas, California, and the Midwest.</p><p>Atlanta-based BellSouth is the dominant local telephone provider in nine Southeastern states.</p><p>The merged company would have 70 million local-line phone customers and nearly 10 million broadband subscribers.</p><p>AT&T would pay around $37 per BellSouth share, according to the Journal, about an 18 percent premium to Friday's closing price of $31.46 on the New York Stock Exchange. BellSouth shares have already risen 16 percent in 2006.</p><p>According to USA Today, AT&T would be paying for the acquisition with its own stock, which closed Friday at $27.99 on the NYSE, up 15 percent since the start of the year.</p><p>Such a merger would have been difficult to get past antitrust regulators only a few years ago, but regulators have recently looked more benignly on consolidation among telephone companies, letting through deals like SBC's acquisition of AT&T and Verizon Communications Inc.'s acquisition of MCI.</p><p>In arguing for the mergers, telephone companies have been pointing out that they no longer are the only way to place a phone call, with competition from cellular, Internet and cable telephony.</p><p>In wireless, AT&T and BellSouth are already partners, jointly owning the nation's largest carrier, Cingular Wireless LLC. That business has grown strongly since it was formed in 2001 by the merger of a number of regional wireless carriers, and there has been speculation that AT&T wanted to assume full control of this growth business.</p><p>BellSouth's price for its Cingular stake may have been an outright sale of the whole company.</p><p>The Cingular brand would be phased out in favor of the AT&T brand, according to the Journal and USA Today. The name will be familiar to wireless customers: AT&T Wireless Inc., a spin-off of AT&T, was acquired by Cingular in October 2004.</p><p>Regulators broke up the old AT&T telephone monopoly, or "Ma Bell," in 1984 into eight regional Bell companies and a long-distance and equipment company that retained the AT&T name.</p><p>The regional Bells have gobbled up one another till now only four remain, with Qwest Communications International Inc. and BellSouth far behind SBC and Verizon in size.</p><p>___</p><p>On the Net:</p><p>HASH(0x1cdef78)</p><p>HASH(0x1d047c8)</p>
