If you own the company being bought: you are usually paid in cash, in shares of the buyer, or a mix, once the deal closes. The stock often jumps toward the offer price when a deal is announced.
If you own the buyer: the stock can move either way, depending on whether investors think the price is fair and the fit makes sense.
Deals take time: most need shareholder votes and regulator approval, which can take months. Some deals change terms or fall through.
The gap matters: a target trading below the offer price usually reflects the time until closing and the risk the deal doesn't happen.
Read the filing: the SEC filing lists the price, payment type and expected timing.
Get the week's biggest deals in your inbox
Our free newsletter explains which deals matter and what they mean for your portfolio, in plain English.