Pretend that USA Today has a section of their site where the sell electronics, which they locate at http://electronics.usatoday.com. The subdomain is powered by an online electronics store called NewCo via a white label. Many of the pages on this subdomain have relatively high PageRank. But few, if any, external sites link to the subdomain--the PageRank of the subdomain is largely due to internal links from the usatoday.com root domain.
USA Today's deal with NewCo expires and they decide to partner with my startup instead. But, unlike NewCo, we won't be providing a white-label solution; rather, USA Today will be redirecting all of the electronics-related links on their root domain to my site instead of the electronics.usatoday.com subdomain. They also agree to direct all of the pages on electronics.usatoday.com to me.
Ideally USA Today would add 301's to all of their pages on electronics.usatoday.com that direct to the corresponding pages on my site, but they don't have the engineering wherewithal or resources to do this. Therefore, what is the best way to pass the PageRank from the electronics.usatoday.com pages to my site? Would it work to have USA Today change the CNAME for electronics.usatoday.com to my site and then create pages on my site that mimic the USA today URL structure? For example, let's say there was a page located at electronics.usatoday.com/ipods. Could we give electronics.usatoday.com a CNAME form my site and then create a page on my site located at mysite.com/ipods that 301'ed to the ipod page on my site? Would that preserve the PageRank?