Best Buy and RadioShack, headed for marriage?

If the consumer electronics industry were an aging diva, it might be gazing into a mirror and declaring "I'm ready for my closeup." Best Buy, Circuit City, CompUSA and RadioShack are all vying for the media spotlight. And now there's news that RadioShack may be up for sale and Best Buy the rumored buyer. But what does it mean for shoppers?

The New York Post is reporting the possibility that RadioShack is on the market with a price tag close to $3 billion,

Wall Street and the financial markets are going bonkers at the prospect of RadioShack being up for sale. "The Shack" hasn't officially hung out a "for sale" sign, but the possibility isn't farfetched and speculation about a buyer has led straight to Best Buy. Given it's the most powerful electronics chain today -- the only national specialty store remaining since Circuit City liquidated last year -- the speculation makes some sense. Or does it?

Not quite. Big retailers will often buy up competitors to speed up expansion. Adding hundreds or thousands of stores in one fell swoop. It seems like a great deal on paper. But in reality it often ends in disaster.

Sure a company acquires lots of stores and brand equity, but they also acquire all the problems that led to that brand being for sale in the first place. In this case, RadioShack has nearly 6,000 locations and 500 kiosks. Inevitably many will be vacated, moved or renovated, at great cost to the acquiring company. Operations have to be analyzed and centralized, also an expensive prospect. RadioShack has a fancy new headquarters in Ft. Worth, Texas it opened in 2005, that would have to be closed down and disposed of. Critical employees would have to be relocated (costly), and the rest laid off (retirement packages and unemployment benefits don't come cheap). This adds a hefty sum to the $3 billion price tag.