AT&T; Plans $3.8-Billion Push in Cellular Market : Telecommunications: The company negotiates for a one-third stake in McCaw, the country’s biggest cellular phone operator.

American Telephone & Telegraph disclosed plans Wednesday to buy a stake worth $3.8 billion in McCaw Cellular Communications, a move that could make AT&T; a major player in the emerging wireless communications market.

The nation’s largest long-distance carrier said that it is negotiating to buy a one-third stake in McCaw, the nation’s biggest cellular phone operator.

AT&T;, which sat on the sidelines while the cellular technology it invented revolutionized mobile communications in the late 1980s, said the investment would give it a stake in the fastest-growing segment of the telephone industry.

McCaw would gain a formidable and rich partner to fight the emerging competition in the new wireless markets from feisty rivals such as cable television operators and the regional Bell phone companies.

“This is a logical and powerful alliance,” said Craig McCaw, chairman and chief executive of McCaw Cellular, which provides cellular service to more than 100 U.S. cities, including Los Angeles and San Francisco. “No deal ever made more sense to me.”

Beyond the immediate scope of the deal, which was roundly praised on Wall Street, analysts said the AT&T-McCaw; alliance could change the landscape of local telephone service and speed development of a nationwide wireless communications network.

Using radio waves instead of copper and fiber lines, the new wireless networks eventually would allow callers with portable pocket phones to make or receive calls from anywhere.

If completed, the deal essentially would put AT&T; back into the local phone business--this time as a wireless telephone company--less than a decade after the Justice Department ordered AT&T; to divest its local Bell phone companies.

Analysts predicted that the AT&T-McCaw; combination would draw protests from the Baby Bell companies fearful of losing their market dominance to both cellular service and the emerging new wireless technologies.

“The regional Bell companies will be screaming,” said A. Michael Noll, acting dean of the business school at the University of Southern California.

Terms of the deal, which is expected to be completed by mid-1993, call for AT&T; to pay $2 billion to buy 47 million shares of new McCaw stock, the equivalent of $42 per share.

AT&T; would pay another $1.8 billion to acquire 35.8 million McCaw shares owned by British Telecom, the equivalent of $49 per share. Combined, AT&T; would pay an average of $45 per share for a stake that would represent one-third of McCaw’s outstanding shares. Furthermore, AT&T; could pay $100 million for an option that would allow it to purchase voting control of McCaw for $600 million.

The prices are nearly twice what McCaw stock was trading for when the stock market opened Wednesday. McCaw shares rose $2.125 to $26.75 before trading was halted in advance of Wednesday’s midday announcement. The rise in McCaw’s stock before the announcement prompted the National Assn. of Securities Dealers to launch an investigation into possible trading irregularities.

Wall Street analysts applauded the plan for giving AT&T; entree into a fast-growing business and allowing McCaw the cash it needs to pay down its staggering $5.5-billion debt.

“It’s awesome,” said Robert Morris, an analyst at Goldman Sachs in San Francisco. “It’s win-win. Besides money to refinance itself, McCaw gets marketing muscle and expertise. AT&T; would get back into the local distribution business again with the technology of tomorrow.”