Sprint has recently seen some good news as the introduction of Samsung's new phone, the Instinct, has been well received.
Any deal with SK Telecom would have to be friendly. The Koreans have no plans to pursue Sprint should it not wish to be acquired. The talks have not reached a crucial phase, and specific negotiation on price has yet to take place, but they have heated up in recent days.
Again, that does not mean a deal is imminent. Sprint briefly entertained takeover talks a few months back with Deutsche Telekom , but nothing materialized.
An acquisition of Sprint by SK Telecom would be complex. First, it is smaller than Sprint in market value and therefore needs the inclusion of private equity partners and of course, it is Korean.
While foreign ownership of a wireless provider is not without precedent—Deutsche Telekom owns T-mobile—it is not without regulatory challenges. It would be the largest purchase of a U.S. company by a South Korean firm.
SK Telecom, which has over 22 million subscribers in South Korea and controls roughly half that country's wireless market, does have an American Depository Share listed on the NYSE. It is not clear if it would use cash or a combination of cash and its ADS's to pursue a deal.
SK Telecom and Sprint employ the same wireless technology, and SK Telecom has made it clear it is focused on global expansion.
For its part, sprint is trying to stem a tide of subscriber losses and a decline in average revenue per user and cash flow. It is expected to show that churn declined over the most recent quarter. The company appointed a new CEO, Dan Hesse, late last year.
A spokesman at Sprint declined to comment on what he called rumors and speculation. A SK Telecom spokeswoman said the company was checking on the reports.
Whether or not this deal happens, it is reflective of what is a surprisingly robust M&A market. Bankers tell me that strategic purchases, whether cross-border or domestic, will keep coming.