new media company is anticipated to have a market value of more than $5 billion
Former President Donald Trump’s Truth Social will make its Nasdaq market debut as early as next week as shareholders of blank-check acquisition company Digital World Acquisition Corp. approved a merger with the social media app’s parent company, Trump Media & Technology Group.
Shares of Trump Media could begin trading on the stock market as early as Monday under the stock symbol DJT.
The new company is anticipated to have a market value of more than $5 billion, based on the Digital World Acquisition Corp. stock price of $44 per share just before the results of the vote were announced.
Trump’s 79 million shares give him a large majority stake in the company and the former president’s brand is critical to the success of Truth Social, which has become critical in communicating with his supporters.
Trump’s more than 60 percent personal stake in the publicly traded entity is estimated to be valued at up to $3.5 billion and will provide the former president with much needed cash for the 2024 presidential election and to cover a $454 million penalty in a civil fraud case in New York.
Former President Trump won’t be allowed to sell any of his shares for at least six months and is barred from using his stake in DJT as collateral for a loan to pay off the penalty, though he could ask the board of the merged company to waive that rule, according to reports.
Although the Digital World Acquisition Corp. board members are Trump supporters, approving the waiver could possibly cause investors to sell their shares, thus negatively affecting the stock price, according to the Wall Street Journal.
There are also possible limits on how much stock Trump can sell over a three-month period tied to the weekly trading volume or number of shares outstanding, the paper reported Friday.
DWAC shareholders’ vote Friday makes them shareholders of Trump Media after pumping more than $300 million into the firm. Upon Trump Media’s initial public offering, DWAC will cease to exist, as happens with blank-check mergers.
Truth Social launched in February 2022, one year after Trump was banned from major social platforms including Facebook and Twitter, the platform now known as X. Trump Media’s board of directors includes Donald Trump Jr., three former members of the Trump of administration, and former congressman Devin Nunes is serving as CEO.
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