I have a company website for our internet agency for over 5 years. It holds blog posts, content pages and our portfolio mainly.

One of our biggest competitors, with mainly the same company activities as we have went bankrupt because it lost 2 of it's biggest clients. I bought their domain from the curator, and it's now ours. I don't have their old website.

The domain has a lot of relevant incoming links, and a high domain authority. Besides that I can see that it also still has a lot of traffic from people that know the old company and look to render it's services.

How do I use the domain so it doesnt hurt but help my website?

I now used DNS change so it's the same as my website, so: www.mywebsite.nl/portfolio.html = www.competitors-website.nl/portfolio.html

And I check incoming links to the new domain and redirect em to relevant pages on my site.

But is this right? Or should I redirect it to my domain so the address bar says: www.mywebsite.nl?