Grey Wolf is licking its wounds after shareholders of the U.S. oil driller rejected the company’s proposed buyout of oil services firm Basic Energy Services on Tuesday. 

Grey Wolf’s shareholders were likely banking on a takeover offer from Canada’s Precision Drilling Trust, which had previously bid $10-a-share for the company and said that the offer would be back on the table if Grey Wolf broke off its deal for Basic. 

Another deal in the U.S. energy services sector could also be in peril, said Raymond James analyst Marshall Adkins, and this one doesn’t even have a competing bid to shake up shareholders.

“It wouldn’t be entirely surprising to see a similar result in the upcoming Allis-Chalmers/Bronco Drilling vote,” Adkins said in a research note on Wednesday. 

Oilfield service company Allis-Chalmers Energy is trying to buy Bronco Drilling in a stock and cash deal currently valued at about $450 million.

Adkins said that, given a recent pullback in Allis-Chalmers shares, the current offer represents a roughly 16 percent discount to its peer group’s price-to-earnings and enterprise value-to-EBITDA multiples.

“As a result, shareholders could reject Allis-Chalmers’ second offer for Bronco,” Adkins said. “Stay tuned for next month’s shareholder vote!”

Bronco shareholders vote on the offer on August 14.

(Reporting by Michael Erman)

Sprint Nextel Corp seems to have a tough time no matter what it tries to do.

Shares of Sprint and South Korea’s SK Telecom Co fell on news the telecommunications companies were in talks for a technology collaboration after previous efforts at a deal had collapsed.

Shares of Sprint lost almost 4 percent in afternoon trading on Wednesday, while SK Telecom closed down 2.7 percent.

Sprint and SK Telecom are discussing a possible pact for technology, but are not in talks for a merger, sources familiar with the matter had told Reuters. The talks may lead to the companies working together to create data applications for cell phones, one source had said. Sprint and SK Telecom declined to comment.

Some media reports said that SK Telecom is considering a minority investment in Sprint even though the No. 3 U.S. mobile telephone services company in November had rejected a $5 billion investment by SK Telecom and a group of private equity firm.

“We note that the previous funding offer was made when Sprint stock was at (about) $15 — 70 percent above current levels,” Goldman Sachs analysts said in research report. Sprint currently trades at about $8.70.

Analysts dismissed speculation that SK Telecom could buy Sprint, which has been struggling to stem the loss of subscribers and integrating its 2005 acquisition of Nextel. Sprint has a $26 billion market capitalization, compared with SK Telecom’s market cap of about $15 billion.

“The size of a potential outright acquisition of Sprint would be problematic given SK Telecom’s smaller size,” Goldman Sachs said. “This deal would require a sizeable cash component, an unlikely scenario in current capital market conditions.”

“SK Telecom’s interest in Sprint’s assets could be lessened given that Sprint agreed to cede partial control of its WiMax spectrum through a contribution into a Clearwire JV,” Goldman Sachs said.

Both SK Telecom and Sprint run wireless networks based on the same CDMA technology, which is widely used in the United States. They have also been looking at the emerging WiMAX technology for next-generation high-speed wireless data.

“What SK brings to the table: SK Telecom’s original proposal highlighted the following merits: (1) economies of scale on handsets/equipment, (2) experience in marketing and driving uptake of mobile data, and (3) technical/strategic expertise on both LTE and WiMax,” Goldman Sachs said.

Still, analysts said SK Telecom has had poor results from its overseas investments so far, especially in the United States. Last month, SK Telecom agreed to sell its money-losing U.S. mobile unit, Helio, for $39 million in stock to Virgin Mobile USA and to invest $25 million in Virgin Mobile. Both Helio and Virgin rent space on Sprint’s network.

A deal involving all three — Sprint, SK, and Virgin Mobile USA — could make more sense, said Lee Shi-hoon, an analyst at Hyundai Securities.

General Motors Corp, which has lost $51 billion in the last three years (yes, that’s right, $51 billion) and is trying to cut costs and restructure yet again, said yesterday it will try to sell up to $4 billion in assets.

That’s a lot of $$ to raise from asset sales. In fact, it’s almost as much as the automaker’s market cap of about $5.6 billion.

So what can it sell? We know it is already reviewing its Hummer brand — and a sale is likely. But with skyrocketing gas prices and a huge slump in demand in the U.S., Hummer, with its 9-14 miles per gallon, will probably not even net GM $1 billion.

What else could it sell? A sale of Onstar, its vehicle communications system, is possible. A sale of its remaining 49-percent stake in its finance arm, GMAC, is also possible. But what is most likely is that GM — often criticized for having too many brands — will try to offload more brands.

Next likely to come under scrutiny (even though GM has said no other brands are for sale) are Saturn — a fading-but-recently-revived brand made more attractive with an independent dealer network — and Saab —  a Swedish “near-luxury” brand which has the disadvantage of being “neither here nor there,” as some investment bankers have said. (It doesn’t have the premium luxury positioning but lacks the scale of a mass-market brand).

But here’s the real conundrum: Potential buyers for the brands would have to be from overseas — a foreign automaker who wants to gain a presence in the U.S. auto market. As U.S. vehicle sales fall to their lowest levels in 15 years and U.S. automakers are cutting production to align with ever-falling demand, it wouldn’t make much sense to help more automakers come into the market and expand their presence here.

That would only end up putting more pressure on profit margins for everyone. It would force the Big Three to cut production further. It would create more competition and more capacity amid slipping demand. It would give a new competitor a space, a dealer network and a platform to grow in a market that is already hurting the Big Three U.S. automakers so much that analysts are wondering if a bankruptcy is on the horizon.

So it doesn’t really make sense. Besides, with GM having said it needs to raise capital by selling assets, potential buyers are likely to lowball offers. But then again, GM needs the cash. Sure, it has $24 billion in cash on hand, but the automaker is burning through a few billion every quarter.

Desperate times call for desperate measures.

Like a bad soap opera, the Internet storyline is getting more and more convoluted. The tale so far: Microsoft Corp, spurned by Yahoo Inc, is courting Time Warner Inc to allow a union with Internet division AOL. But Yahoo, which turned its back on Microsoft’s $47.5 billion bid, also wants AOL’s hand. These talks have taken on a new urgency ahead of Yahoo’s Aug. 1 shareholders meeting, a source familiar with discussions told Reuters on Tuesday. How either marriage will work is not immediately clear, but any combination will likely redraw the landscape for advertising on the Internet. So why is AOL so attractive? Both Yahoo and Microsoft view it as beneficial to leverage their positions in the Internet marketplace, where search giant Google Inc dominates. Stay tuned.

But good soaps are not only made in America. It seems the Germans are good at them, too. Tires-to-brakes maker Continental rejected Schaeffler Group’s surprise 11.2 billion euro ($17.8 billion) bid, saying only the family owned firm stood to gain from the offer which was too low. Late on Tuesday, the ball-bearing maker announced the terms of its proposed takeover after winning control of more than a third of Continental’s shares through a web of options organized for it discretely by banks. Schaeffler’s bearings are found in London’s landmark Ferris wheel, the London Eye and it also makes high-precision bearing supports for the U.S. space shuttle and the European launch vehicle Ariane, not that that has any bearing on a deal.

Some suitors, however, do get lucky. Mining company Cleveland-Cliffs Inc said on Wednesday it would acquire Alpha Natural Resources Inc for about $10 billion in cash and stock to expand its coal assets. Stockholders of Alpha, an Appalachian coal producer, will receive 0.95 of a Cleveland-Cliffs common share and $22.23 in cash for each of their common shares when the union is completed. Based on closing stock prices on Tuesday, the deal values Alpha at $128.12 per share, a premium of 35 percent, the companies said in a statement. The combined company will be renamed Cliffs Natural Resources and will include nine iron ore facilities and more than 60 coal mines located across North America, South America and Australia.

More deals of the day:

** Shareholders of utilities Suez and Gaz de France are set to approve a long-delayed 100-billion euro ($159.5 billion) merger, creating Europe’s second-largest electricity and gas group.

** The Co-Operative Group has agreed a long-awaited deal to buy Somerfield for 1.57 billion pounds ($3.1 billion) to strengthen its position as Britain’s fifth-biggest food retailer.

** Russian real estate company LSR said it had acquired a property developer in Yekaterinburg in the Urals region for 100 million euros ($159.5 million).

** Bank Hapoalim, one of Israel’s largest banks, said it was in advanced talks to buy at least 75 percent of Russian mid-sized SDM Bank at a value of $142 million.

** Irish healthcare services company United Drug said it had bought U.S. packaging maker Sharp Corporation for $99 million in cash.

** The board of Australian energy firm Roma Petroleum NL said shareholders should accept the revised A$49.4 million ($48.4 million) takeover offer from Queensland Gas Co Ltd.

** Parsvnath Developers Ltd said it will invest 4 billion rupees for a 38 percent stake in the Nanocity project in northern India.

** Shares in SK Telecom, South Korea’s top mobile carrier, fell early after a CNBC report that it was negotiating to buy Sprint Nextel Corp , the No. 3 U.S. mobile service.

** Swiss engineering group ABB said it will acquire U.S. transformer company Kuhlman Electric Corporation from private equity firm Carlyle Group for an undisclosed sum.

** EPIC Energy Ltd said it had acquired Sathian Sun Power Systems, a solar energy products supplier based in the southern state of Tamil Nadu, for an undisclosed sum.

** Airbus said it has agreed to set up a venture with Harbin Aircraft Industry Group (HAIG), the parent of Hafei Aviation Industry Co, to make aircraft components.

If you’re getting lost in all the nasty rhetoric between Yahoo, Microsoft and Carl Icahn, here’s our primer on what the fuss is all about.

They’re trading insults (again) after the latest deal talks broke down (again). Microsoft’s top lawyer is pressing the antitrust issue in Yahoo’s Google search partnership in Washington today, while Yahoo’s top lawyer accused Microsoft of trying to force a fire sale.

Don’t forget, this comes after Monday’s war of words over the latest Microsoft proposal to acquire Yahoo search, which was floated with the help of billionaire activist investor Icahn and rejected by Yahoo (again). Here’s what they’re saying about that deal:

Source: Statements from Yahoo, Microsoft and Icahn