Five Business Hookups You Might See

This column was originally published on Street Insight on Jan. 11 at 7:21 a.m. EST. It's being republished as a bonus for TheStreet.com and RealMoney.com readers. For more information about subscribing to Street Insight, please click here.

All too often, the media and investors merely speculate about potential takeovers and start rumors. I, on the other hand, prefer to contemplate what would make a nice corporate match in a Yenta the Matchmaker-type way.

Here is my list of five mergers and acquisitions that make sense to me -- with the reasons why, and the reasons why they might not happen:

1. Sears Holdings (SHLD Quote) to acquire warehouse retailer BJ's Wholesale Club (BJ Quote).

Why it makes sense: Sears still has underperforming stories -- or Kmart-Sears stores that are cannabilizing one another -- and it's in the process of transforming them into new concepts or selling off their real estate. BJ is dwarfed by Costco (COST Quote). Sears can buy BJ and expand BJ, utilizing those superfluous Kmart-and-Sears stores to capture more of the fast-growing warehouse business from Costco and Wal-Mart's(WMT Quote) Sam's Club. Currently, BJ's market cap is just under $2 billion. Sears has the cash and stock currency to easily pay a 20% premium to BJ shareholders and still make an accretive acquisition.

Why it might not happen: Sears' Eddie Lampert is focused on improving the merchandising in existing Sears stores and continues to experiment with new concepts such as in the Gwinnett Place Mall.

2. Morgan Stanley (MS Quote) to acquire an investment adviser: Legg Mason (LM Quote) or T Rowe Price (TROW Quote).

Why it makes sense: The missing ingredient in MS' mosaic of businesses is asset management, and it's a glaring hole. MS must make inroads into this segment if it truly wants to compete with Merrill Lynch (MER Quote) and Goldman Sachs (GS Quote). John Mack brought in James Gorman from Merrill a few years ago, and he would be the right person to spearhead this effort.