Donald Trump Poised For Billions In Paper Gains After SPAC Shareholders Vote To Merge With His Social Media Firm

Dade Hayes

22 March 2024 at 0:28 pm·2-min read

Donald Trump, at least on paper, is in position to reap several billion dollars after shareholders of Digital World Acquisition Group voted Friday to merge with his social media firm.

The newly merged entity, Trump Media, will include a media business as well as Trump’s social network, Truth Social. It could begin trading next week under the ticker symbol DJT.

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Digital World is a special-purpose acquisition company, or SPAC, which is an entity set up expressly for the purpose of engineering a merger. The company burned through its initial cash reserves over the past two years, encountering a number of stumbling blocks on the way to Friday’s vote, which removed the final hurdle to the plan to merge and take the new stock public.

Even if shares go to the moon, the proceeds will not be available in the short term for Trump or other stakeholders. Typically, there is a lock-up period of six months after an IPO, which is a restriction aimed at preventing a disruptive sale of shares. The former president is facing a Monday deadline for posting a $464 million bond related to a judgment against him in New York stemming from charges that he overstated the worth of properties and other assets. He also faces hefty legal bills for his defense against dozens of other counts in other federal and state cases.

Truth Social was started after Trump was booted from Twitter and other social media platforms in the wake of the January 6 storming of the U.S. Capitol. It has posted underwhelming growth since. Trump’s account on Twitter, now known as X, was restored by Elon Musk after he bought the platform in 2022.

Trump will have a 58% stake in the new entity and the amount he will benefit depends on the performance of DWAC stock in the period leading up to the public debut of the new company. Shares reached mid-day at break-even, trading at a bit less than $43. The stock has attracted some interest from retail investors who have seen it as a proxy for Trump’s campaign to return to the White House.

Along with the former president, one key beneficiary of the merger could be Devin Nunes, the former Republican Congressman from California who departed to head up Trump’s media concern.

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