I know it's good news when you own shares in a company that's being bought by another. But why? Is it just because the share price tends to do up, so you sell? Or is there more to it? When would you hold on to them? Would you become a shareholder in the new company, or do they sometimes want to buy you out? Or is it different every time? I'd be glad to hear the community's wisdom on the subject.

This question is prompted by Ed's post today about The Club selling Wey Education on the news of a recommended takeover bid. It made me realise I wouldn't know whether the obvious thing to do - sell at a profit - was always the right thing to do.

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