Sprint Nextel, SK Telecom Weigh Alliance

South Korea's SK Telecom Co. and U.S. wireless carrier Sprint Nextel Corp. are in preliminary talks to form a strategic partnership to develop new handsets and services, people familiar with the matter said.

The companies have discussed the idea of SK Telecom making a minority investment in Sprint, but they aren't discussing an outright merger, the people said. Last fall, Sprint rejected a $5 billion investment offer by SK Telecom and Providence Equity Partners.

Any investment ...