Sprint and EDS Cancel Wedding Invitations : Mergers: The proposed marriage breaks up over stock price demands made by the telecommunications firm.

Joining in the trend toward broken engagements, Sprint Corp. and Electronic Data Systems Corp., GM’s computer integration subsidiary, said Monday that they have cut off their merger talks.

The proposed marriage, designed to combine the two companies into a publicly held, $20-billion-a-year telecommunications and computer behemoth, foundered on Sprint’s insistence that it be valued at a 20% to 30% premium above its market price.

Although EDS and Sprint are roughly equal in market value, Sprint wanted 1.3 shares of EDS for each of its common shares. General Motors Corp., EDS’ parent, would offer only 1.1 EDS shares.

Analysts say EDS’ market value of roughly $16 billion is complicated by EDS’ dependence on GM for about 38% of its business. Although GM agreed to continue using EDS for 10 years after the company was spun off, there was some concern that GM might expect to get EDS’ services at a lower price once it was independent.

Each side expressed surprise at the other’s stubbornness. GM says the two sides had agreed that the deal was a “merger of equals,” implying similar valuations. Sprint says GM should not have been surprised.

Sprint and EDS said they are still exploring some form of partnership to take advantage of their respective strengths in computing and telecommunications.

“There may be other ways we can work together to achieve strategic objectives,” Les Alberthal, EDS chairman and chief executive, and William Esrey, chairman and chief executive of Sprint, said in a joint statement.

The collapse of the Sprint-EDS merger plan is only the latest in a string of such deals that have fallen through recently. Bell Atlantic’s plan to merge Tele-Communications Inc. fell apart after Bell decided its valuation of TCI had been too high. That deal’s failure was followed by the blowout of several similar deals between cable companies and telephone companies.

One common problem may have been premature disclosure. Sprint and EDS were forced to go public with the merger talks three weeks ago because of widespread speculation among media and analysts, even though details had not been worked through.

“When you have analysts and the press participating in speculation, it makes negotiations difficult,” GM spokesperson Toni Simonetti said.

U.S. West’s agreement last spring to invest $2.5 billion in Time Warner Inc., by contrast, may have been successful in part because it was kept under close wraps until every detail was ironed out.

“It took us two years to negotiate our alliance with Time Warner. We did it out of the limelight,” said Jerry Brown, a spokesman for U.S. West. “Several times we were ready to announce but then backed off. Some of the other deals were put together and announced before they were ready.”

But failed deals won’t slow the pace of deal making, in the eyes of some.

“These are soft deals, that’s a way of life,” said Mario Gabelli, chief investment officer at New York mutual funds company Gabelli Funds Inc. He predicts a continued strong wave of deal making as corporate executives follow the lead of General Electric, with its hostile bid for Kemper Corp. in March.

Sprint, meanwhile, a weak third in the long-distance telephone market, remains on the lookout for partners to help battle AT&T; and MCI. The company is reportedly talking with Japanese and European phone companies about possible alliances.

Sprint is also talking about working with regional Bell companies to create a nationwide cellular network.

Meanwhile, General Motors is expected to keep looking for partners for EDS. The auto maker would like to get some of its money out of EDS, a company it paid $2.5 billion for and which is now valued at $16 billion.

GM said Monday it would still consider spinning off EDS if that would help the company reach its strategic objectives.