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SEC Approves Trump’s Truth Social Deal Worth Up To $10B

This photo illustration shows an image of former President Donald Trump on a phone screen displaying the Truth Social app on February 21, 2022 in Washington, DC. – Donald Trump’s new social media app will begin a gradual rollout later on February 21st and should be “fully operational” by late March, one day after being banned from major platforms. More than a year later, the former president’s profile may increase. (Photo by STEFANI REYNOLDS/AFP) (Photo by STEFANI REYNOLDS/AFP via Getty Images)

OAN’s Elizabeth Bolbelding
6:00 PM – Monday, February 19, 2024

The U.S. Securities and Exchange Commission (SEC) has approved the merger of former President Donald Trump’s social media platform Truth Social with blank check company Digital World Acquisition Corporation.

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After a two-year delay due to a thorough review by regulators, the SEC has finally approved the controversial merger, which will reportedly launch on Wall Street soon under Donald Trump’s Truth Social platform. .

Trump Media & Technology Group, which owns Truth Social, and Digital World Acquisition Corporation (DWAC), a special acquisition company (SPAC) that aims to take the company public, have received approval from the SEC to merge.

So this could give Trump substantial ownership in the business. According to new SEC filingsTrump is believed to own about $79 million worth of company stock.

As of Friday morning, DWAC stock was trading at just over $49.50, giving the stock a value of about $4 billion.

The paper highlighted how some investors, many of whom are Trump supporters, are overlooking Truth Social’s losses and small user base due to Trump’s involvement. The stock market has more than tripled its value since January as President Trump solidified his bid to win the 2024 Republican nomination.

Depending on how popular the deal is with investors, Trump’s ownership in the combined company will reportedly range from 58.1% to 69.4%.

Depending on how the presidential election unfolds, Mr. Trump could sell his interest in Truth Social and step down from management, according to a regulatory filing by DWAC on Wednesday.

The SEC has approved a filing containing new details about the operations of Trump Media & Technology Group, the parent company of Truth Social. This allowed DWAC to organize a shareholder vote to approve and finalize the merger.

DWAC stock rose 16% to $50.49 in Thursday afternoon New York trading.

At the current stock price and assuming DWAC shareholders do not exercise their right to redeem their shares, the combined company would be valued at about $10 billion, of which Trump would own 58.1%, or about $4 billion. I will do it.

But approval from the SEC took a long time.

In June 2022, DWAC said further documents and details regarding the proposed merger were being examined by security regulators. Authorities were particularly concerned with “communications and due diligence regarding potential targets other than the target.” [Trump’s company]”

Mr. Trump has virtually unlimited authority over DWAC under his agreement with the company. Previous submissions emphasized that personal or political actions will not be considered a breach of the agreement, even if they are “dishonest, illegal, immoral or unethical”.

Additionally, Trump can choose board members and could block actions that would normally require shareholder consent, such as takeovers.

President Trump’s Truth Social currently has 6.62 million followers.

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