The two sides have held talks since Elliott disclosed a $2.3 billion stake in the telecom giant, the WSJ described.
That investment came with a scathing letter about all the things wrong with the company, in Elliott's opinion.
In September, the activist firm wrote:
"Elliott’s letter outlines a four-part plan – the Activating AT&T Plan – that would improve AT&T’s share price and its business. The Plan recommends increased strategic focus, improved operational efficiency, a formal capital allocation framework, and enhanced leadership and oversight" which took a direct swipe at CEO Randall Stephenson.
Additionally, Elliott voiced concerns about AT&T's $85 billion purchase of Time Warner, saying it has not yet articulated a “clear strategic rationale” for needing to own the company.
“While it is too soon to tell whether AT&T can create value with Time Warner, we remain cautious on the benefits of this combination,” Elliott said. “We think that, after $109 billion and three years, we should be seeing some manifestations of the clear strategic benefits by now.”
After acquiring Time Warner, AT&T’s debt load was around $180 billion. The company has been selling off assets to help pay down its debt, but Elliott thinks more needs to be done.
Since then, FOX Business has reported that the company has worked to address some of Elliott's concerns.
"AT&T already appears to be implementing some of Elliott’s suggestions...AT&T said it is unloading $2 billion worth of assets in Puerto Rico and the Virgin Islands to Liberty Latin America" while also noting "Private equity powerhouse Apollo Global Management, working with an outside banker, is pitching AT&T, Inc. a deal that would allow the telecom conglomerate to offload some of the risk of its troubled DirecTV unit while still maintaining control of the satellite service provider."
FOX Business' Jonathan Garber, Charlie Gasparino and Lydia Moynihan contributed to this report.