AT&T Inc. agreed to buy BellSouth Corp. for $67 billion in stock. If the transaction is completed, the seven regional Baby Bell companies created in the government's 1984 breakup of AT&T Corp. would be reduced to three. Industry analysts predicted that more mergers in telecommunications probably would follow.

The proposed marriage of AT&T and BellSouth, the nation's largest and third-largest phone companies, was driven largely by their joint ownership of Cingular Wireless. That mobile phone company and all of BellSouth's businesses would be renamed and folded into AT&T.

The current AT&T is the former SBC Communications Inc., the San Antonio company that provides most phone service in California. SBC adopted the AT&T name after it acquired its former parent company in November.

AT&T and BellSouth said their combination, which will require approval by shareholders and the federal government, would save nearly $18 billion in costs and might result in a projected 10,000 layoffs. The companies employ more than 250,000 people altogether and have nearly 70 million phone lines in operation.

By: DocMemory
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