Of course they do DD but their DD still could be wrong....

Of course they do DD but their DD still could be wrong. Personally, I'd be more concerned the co-founder sold such a large stake. Who would be more in the know? Some rich dude from HK or the co founder and CEO's dad? If it was such a great company, the old man wouldn't have sold and the company could have issued these shares to the acquiring business at the same price as the sale. No one complains when cash is raised higher than market price do there likely would have been limited back lash.

Looks to me like the old man wanted a cut out above what they got during IPO. Better than a potential crash and burn and end up with nothing. And for those reading tea leaves suggesting that all significant investors are geniuses, I think there have been plenty of rich dudes thinking some tech company would be the next big thing and getting stuck in the sales pitch like a deer in the headlights.