(Reuters) - AT&T Inc is considering an offer to divest a significantly larger portion of assets than it had initially expected, in order to salvage its $39 billion deal to buy T-Mobile USA, Bloomberg reported citing a person familiar with the plan.

Bloomberg said the exact size of the divestiture hasn't been determined but reported it could be as much as 40 percent of T-Mobile USA's assets.

The divestiture is an attempt to address the concerns of the Justice Department, which sued to block the takeover on August 31 saying the deal would "substantially lessen competition" in the wireless market, Bloomberg said.

The proposed deal was dealt another blow on November 22, when the Federal Communications Commission's chairman sought to have it sent to an administrative law judge for review.

The asset-sale proposal, which could come as early as the next Justice Department hearing on November 30, might be the only remaining option if the second-largest U.S. wireless operator wants to avoid a lengthy court battle in its bid to become the country's top mobile carrier, Bloomberg said.

(Reporting by Ankur Banerjee in Bangalore; Editing by Anthony Kurian)