The reason they sell out is essentially that they don't expect to be able to do better long term (risk adjusted) essentially regardless of reason. If the entre

The reason they sell out is essentially that they don't expect to be able to do better long term (risk adjusted) essentially regardless of reason. If the entrenched company is offering a large value for a company they recognize some sort of value to it and could try to replicate it with the funding if told "no" and that may be a fight they feel would have a good chance of losing, that growing bigger means it is "not enjoyable/in their skillset" anymore or similar reasons. A doom of stagnation is also less than certain - the sellers care about cash first and foremost and would not priveledge entrenched beyond what they can pay and the given source funding may hypothetically come from many others - whether CEO or even "large collection of retirement or university endowment funding" even if they are run by CEOs essentially are not necessarily the status quo.