AT&T and the US Department of Justice (DoJ) extended the deadline for their current round of talks on Time Warner, offering hope a deal can be struck out of court, New York Post reported.

Sources quoted by the newspaper said discussions would continue beyond the end of this week to see if a resolution can be reached. No new end date was revealed.

Should the two fail to reach an agreement, AT&T will likely seek to proceed with the deal and the Department of Justice (DoJ) would be forced to sue to block, or gain concessions on, the merger, the newspaper reported.

Progress appeared to positive shortly after talks opened in July, with the acquisition originally meant to close by the end of October.

However, in recent weeks the mood has turned increasingly sour with several media leaks outlining reported DoJ demands and counter-statements from AT&T reiterating it was unwilling to meet such requests.

Reports from both sides appear to now to be mostly focused around plans for the courtroom.

Last week, AT&T CEO Randall Stephenson confirmed the company was prepared for litigation and would rather fight the case than sell any of its content assets.

Hours before the executive’s comments, The Wall Street Journal reported the DoJ was preparing for legal action.

In an article on 15 November, CNBC said the DoJ had written to the attorneys general of 18 US states seeking support in its legal case but none, by then, had agreed.

AT&T’s attempted $85 billion merger with Time Warner was first announced by the companies in October 2016 and has since been going through the regulatory approval process.