"The U.S. government filed a lawsuit on Wednesday to stop Halliburton Co from buying Baker Hughes Inc, arguing the combination of the No. 2 and No. 3 oil services companies would lead to higher prices in the sector.

The move, which comes after months of talks on divestitures of some overlapping businesses, significantly cuts the chances of the deal going through, although Halliburton said it would "vigorously contest" the lawsuit.

The Justice Department said the merger, valued at $35 billion when it was first announced in November 2014, would leave only two dominant suppliers in 20 business lines in the global well drilling and oil construction services industry, with Schlumberger NV (SLB.N) being one of the two."

Diane Bartz and Terry Wade report for Reuters April 6, 2016. [2]