May 20 (Reuters) - U.S.-based real estate investment

trusts AvalonBay Communities ( AVB ) and Equity Residential ( EQR )

are nearing a deal to merge, Bloomberg News reported on

Wednesday, citing people familiar with the matter.

* Under the deal, AvalonBay shareholders would receive 2.793

shares of Equity Residential ( EQR ) common stock for each share of

AvalonBay common stock owned, the Wall Street Journal reported,

citing sources.

* AvalonBay shareholders would be expected to own a little

over 51% of the combined entity, which will pay out an initial

annual dividend to shareholders of $2.81 per share, the WSJ

said.

* An announcement on the deal could come as soon as

Thursday, the reports said.

* Reuters could not immediately verify both reports.

AvalonBay Communities ( AVB ) and Equity Residential ( EQR ) did not immediately

respond to Reuters' request for a comment on the reports.

* AvalonBay holds a market value of about $26 billion and

Equity Residential ( EQR ) is valued at nearly $25 billion, according to

LSEG-compiled data.

* AvalonBay owns or holds ownership interest in 319

apartment communities with 98,271 apartment units in the U.S.,

while Equity Residential ( EQR ) owns 312 rental properties consisting

of 85,211 apartments.