The Securities and Exchange Commission on Thursday cleared the way for a merger between blank check acquisition firm Digital World Acquisition Corp. and former President Donald Trump’s media technology company.
digital world Said The registration statement for a proposed merger with Trump Media & Technology Group (TMTG), the operator of social media platform Truth Social, has been declared effective by the SEC.
A deal would be a major boost for Trump, who will own about 58% of the newly formed company.
DWAC stock soared nearly 30% on Thursday morning, hitting a trading high of $56.30 and closing 16% higher at $50.56. Shares of Rumble, a video-sharing platform popular with conservatives, rose nearly 6.7%, and Punware, a software development company hired by President Trump’s 2020 re-election campaign to develop a phone app, rose 1.6%. did.
Phunware was one of the most traded stocks across major US exchanges.
Digital World said it plans to announce within two business days the date for a special general meeting of shareholders to vote on approval of the merger. Representatives from DWAC did not respond to requests for comment.
The stock has risen more than 150% since Jan. 15, when Trump won the Iowa caucuses in a bid to boost his standing as the Republican nominee for this year’s presidential election.
TMTG’s founders created the company as a way for President Trump to connect with his supporters after he was cut off from major social media platforms following the Jan. 6, 2021, attack on the U.S. Capitol by his supporters. I launched it.
Trump, the leading candidate for the Republican presidential nomination, has 6.61 million followers on Truth Social, but at the time the platform permanently suspended him, he had more than 88 million followers on Twitter. The platform currently has 87.4 million followers. , now called X.
On November 19, the San Francisco-based app reversed its position under self-proclaimed “free speech absolutist” billionaire Elon Musk, who acquired Twitter on October 2.
Digital World has faced several challenges since signing the deal with TMTG in October 2021. The company has been the subject of investigations by the Department of Justice and the SEC, fired its chief executive officer and replaced its board of directors.
These investigations contributed to the delay in the transaction. In July 2023, DWAC reached an $18 million settlement with the SEC. The SEC had accused DWAC of making material misstatements in documents filed with the SEC as part of DWAC’s initial public offering and proposed merger with TMTG.
The SEC found that DWAC misled investors and the SEC and violated federal securities laws by failing to disclose that DWAC had developed and was pursuing an acquisition plan for TMTG prior to its initial public offering. .
In August, Trump broke his promise to remain solely on Truth Social and posted a photo of himself on X while he was booked into the Fulton County Jail in Georgia. He has not posted on his X since then and uses Truth Social as his primary platform to reach voters.
