Should Microsoft (MSFT) Acquire Barnes & Noble (BKS)? Sure.

January 12, 2012 5:00 PM EST
File the following under the "why not?" category.

Q: What does Barnes & Noble (NYSE: BKS) have going for it? A: The NOOK e-reading device and physical locations. Q: What does Microsoft (Nasdaq: MSFT) have going for it? A: Everything but a decent tablet/mobile device and Microsoft-specific stores.

See where this is going...?

An analyst from Corum Group who recently appeared on CNBC, knows exactly where this is going: Microsoft could acquire Barnes & Noble.

The analyst thinks the acquisition would give Microsoft instant exposure to malls across America, and let the company be able to sell specific wares just like Apple (Nasdaq: AAPL). Barnes & Noble has about 700 brick-and-mortar locations throughout the U.S.

The analyst said at Corum's 2012 M&A Forecast conference, he spoke with a friend at Microsoft who indicated strategies behind such a deal are already in place.

And Microsoft would effectively be killing two birds with just one stone: with it and Barnes & Noble in horns over Google (Nasdaq: GOOG) Android patents, the company could gain a tablet and avoid litigation through that strategic move.

On the other hand, does the world need more Windows exposure? Look around any Wal-mart (NYSE: WMT), Target (NYSE: TGT), Best Buy (NYSE: BBY), etc. which has an electronics department, and you'll see plenty of Microsoft items from Windows to Xboxes and accessories. Reasoning behind buying physical Barnes & Noble locations would be if Microsoft's new offerings were as unique as Apple's, something which certainly hasn't happened in years.

Shares of Microsoft ended about 1 percent better Thursday, while Barnes & Noble finished about 0.2 percent higher.


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