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The veteran starter will receive a one-year deal that will pay him $13 million, which is prorated from a figure of $21.21 million, sources said, confirming a Yahoo! report.
Keuchel is scheduled to have his physical Friday and is slated to make a start for Triple-A Gwinnett on Saturday, sources told ESPN.
Atlanta is 33-29, two games behind the first-place Philadelphia Phillies in the National League East.
Atlanta also had interest in signing All-Star closer Craig Kimbrel but wasn't willing to be as aggressive as the Chicago Cubs were. Chicago and Kimbrel on Wednesday agreed to a three-year deal worth $43 million that includes a fourth-year option, sources said.
Keuchel, the 2015 AL Cy Young Award winner, went 12-11 with a 3.74 ERA and 153 strikeouts in the 2018 regular season for the Astros and made two postseason starts with a 3.60 ERA and no record. He made $13.2 million.
The 31-year-old turned down a $17.9 million qualifying offer by the Astros after the season.
Keuchel is particularly reliant on the ground ball. Though his ability to change speeds and the movement of his slider are what propelled him to ace status, both his change and slider were below-average pitches in 2017. This at times necessitated an overreliance on the cutter, now his best pitch, which got Keuchel into trouble in 2018, as he lost eight of his first 13 starts.
He rebounded with a 3.23 ERA over his final 20 starts.
"He got back to being himself," Astros manager A.J. Hinch told reporters during the postseason. "He knows who he is, what he does best -- attacking the game plan, improvising as the game goes along. He gets the ball on the ground. He gets soft contact. He got ultra-focused on just getting back to his strengths and being himself."
Keuchel earned his second All-Star nod in 2017 and was 14-5 with a 2.90 ERA in 23 regular-season starts, helping lead Houston to its first World Series title. He struck out 10 in seven scoreless innings to get the win in the opener of the American League Championship Series against the New York Yankees and won Game 2 of the AL Division Series against the Boston Red Sox.
In seven seasons with the Astros, Keuchel was 76-63 with a 3.66 ERA. He was 20-8 with a career-best 2.48 ERA in 33 starts in 2015 and set a major league record by going 16-0 at home. He was the starting pitcher for the AL in the 2015 All-Star Game and has won three Gold Gloves.
He also dazzled the Yankees over six shutout innings to win the 2015 AL wild-card game after helping Houston reach the playoffs for the first time since 2005.
Keuchel, a seventh-round pick in the 2009 amateur draft, made his major league debut in 2012, when he posted a 3-8 record with 38 strikeouts in 16 games.
ESPN's Jeff Passan contributed to this report.