--- a/hgext/sparse.py	Thu Jul 06 16:17:35 2017 -0700
+++ b/hgext/sparse.py	Thu Jul 06 16:29:31 2017 -0700
@@ -102,7 +102,6 @@
 command = registrar.command(cmdtable)
 
 def uisetup(ui):
-    _setupupdates(ui)
     _setupcommit(ui)
 
 def extsetup(ui):
@@ -136,10 +135,6 @@
         raise AttributeError(_("type '%s' has no property '%s'") % (origcls,
                              propname))
 
-def _setupupdates(ui):
-    extensions.wrapfunction(mergemod, 'calculateupdates',
-                            sparse.calculateupdates)
-
 def _setupcommit(ui):
     def _refreshoncommit(orig, self, node):
         """Refresh the checkout when commits touch .hgsparse

--- a/mercurial/merge.py	Thu Jul 06 16:17:35 2017 -0700
+++ b/mercurial/merge.py	Thu Jul 06 16:29:31 2017 -0700
@@ -975,7 +975,10 @@
 def calculateupdates(repo, wctx, mctx, ancestors, branchmerge, force,
                      acceptremote, followcopies, matcher=None,
                      mergeforce=False):
-    "Calculate the actions needed to merge mctx into wctx using ancestors"
+    """Calculate the actions needed to merge mctx into wctx using ancestors"""
+    # Avoid cycle.
+    from . import sparse
+
     if len(ancestors) == 1: # default
         actions, diverge, renamedelete = manifestmerge(
             repo, wctx, mctx, ancestors[0], branchmerge, force, matcher,
@@ -1074,7 +1077,10 @@
         fractions = _forgetremoved(wctx, mctx, branchmerge)
         actions.update(fractions)
 
-    return actions, diverge, renamedelete
+    prunedactions = sparse.filterupdatesactions(repo, wctx, mctx, branchmerge,
+                                                actions)
+
+    return prunedactions, diverge, renamedelete
 
 def batchremove(repo, wctx, actions):
     """apply removes to the working directory

--- a/mercurial/sparse.py	Thu Jul 06 16:17:35 2017 -0700
+++ b/mercurial/sparse.py	Thu Jul 06 16:29:31 2017 -0700
@@ -301,18 +301,16 @@
 
     return result
 
-def calculateupdates(orig, repo, wctx, mctx, ancestors, branchmerge, *arg,
-                      **kwargs):
-    """Filter updates to only lay out files that match the sparse rules.
-    """
-    actions, diverge, renamedelete = orig(repo, wctx, mctx, ancestors,
-                                          branchmerge, *arg, **kwargs)
+def filterupdatesactions(repo, wctx, mctx, branchmerge, actions):
+    """Filter updates to only lay out files that match the sparse rules."""
+    if not enabled:
+        return actions
 
     oldrevs = [pctx.rev() for pctx in wctx.parents()]
     oldsparsematch = matcher(repo, oldrevs)
 
     if oldsparsematch.always():
-        return actions, diverge, renamedelete
+        return actions
 
     files = set()
     prunedactions = {}
@@ -383,4 +381,4 @@
             elif old and not new:
                 prunedactions[file] = ('r', [], '')
 
-    return prunedactions, diverge, renamedelete
+    return prunedactions