Pactel, Cellular Agree to Merger of Some Interests

Pacific Telesis Group and Cellular Communications Inc. said Wednesday that they would merge their cellular telephone interests in Ohio and Michigan in a move that ultimately will further consolidate the growing industry.

The deal calls for San Francisco-based PacTel to invest at least $87 million for an immediate 5% stake in Cellular Communications. Within the next six years, PacTel could take over Cellular Communications entirely for another $600 million or more.

The merger is the latest in a series of recent moves by telecommunications companies to strengthen their cellular operations throughout the world. They are seeking to take advantage of huge projected growth in radio wave telephone services fueled by new technology, improved transmission devices and declining equipment prices.