South Korea’s SK Telecom (NYSE: SKM) is in talks to buy Sprint Nextel, the third-largest U.S. carrier, according to CNBC, Reuters reports. The report did not name any sources for the story, but said a deal between the companies would be friendly and that it would be the biggest takeover of a U.S. company by a South Korean company.  Sprint Nextel’s shares rose almost 14 percent after the report was aired. Sprint declined to comment and SK was unavailable for comment. Most recently, SK Telecom negotiated a merger between Virgin Mobile USA (NYSE: VM) and Helio, which was a joint venture between SK Telecom and Earthlink (NSDQ: ELNK). The merger required a lot of participation by Sprint, which both companies used as their network. Sprint agreed to cut the costs associated for the MVNOs. CNBC reported that any deal would include private equity because SK Telecom is smaller than Sprint (NYSE: s) in terms of market capitalization. The unidentified sources also told CNBC that talks are on-going, but a deal is not imminent and any agreement could be weeks away. The deal would be complex because of the foreign regulatory hurdles that would have to be met, however, on the technology front Sprint Nextel and SK Telecom both use CDMA, which would help on any sort of integration efforts.

UPDATE: Reuters is now reporting that sources are calling the CNBC report incorrect—that the two companies are not in acquisition talks, but rather are talking about collaborating on technology efforts. “There are no acquisition talks going on right now between SK Telecom and Sprint (NYSE: S). Any discussions that are going on are around technology collaboration,” the source told Reuters.

WSJ is reporting something similar: The two are in prelim talks to form a “strategic partnership to develop new handsets and services”.