What type of company purchases outstanding shares of another company?

Question

what type of company purchases shares in another company?what is the purpose of that company? do they sell share after increase in value in that share?

Answer 1

Funds buy shares in other companies for their shareholders.

Also, companies often buy other companies to expand their customer base (banks buying other banks) or expand their product base. (like Microsoft buying Goggle)

Answer 2

Hedge funds are actually companies and usually plan to sell the stock later.

Sometimes companies will invest in companies they do business with to give them access to capital.

Sometimes a company will be trying to take over another company.