Reuters had reported on Monday that AT&T is in serious talks with DirecTV to buy it at a price of $50 billion which means a share price in the range of mid $90s.
Both the entertainment giants have agreed on the fundamental terms of the agreement and will announce the transaction after approval from each company’s Board of Directors.
AT&T earlier has had a failed bid for acquisition of T-Mobile USA in 2011 and another possible takeover of Vodafone.
After buying DirecTV, AT&T might see its research segment boost and it is also likely to have good impact on dividends due to cash flow from DirecTV.
The people familiar with the transaction said that Bank of America, Merril Lynch and Goldman Sachs Group are advisers of DirecTV and AT&T is being advised by Lazard Ltd.
The deal, if materialized would mean, that the country’s No. 2 wireless carrier and the biggest satellite provider will be merging which means an addition of 20 million customers for AT&T.
Both the companies have declined to comment on the news so far.