Former US President Donald Trump on Friday took another step closer to a big profit from his social media company, after special purpose acquisition company (SPAC) investors approved a merger currently expected to cost around 5.7 billion dollars.
The deal values Trump’s majority stake in the company that owns the Truth Social app at about $3.3 billion.
The windfall could be vital as Trump faces the financial fallout from a series of lawsuits against him, including a $454 million judgment in a civil fraud case in New York.
Shareholders of Digital World Acquisition Corp (DWAC), the SPAC company that plans to list Trump Media & Technology Group (TMTG) on the stock market through a merger, voted in favor of the deal on Friday.
While the next step is to complete the deal next week, its future is full of uncertainty.
Patrick Orlando, former CEO of Digital World, and former Trump business partners Andy Litinsky and Wes Moss have filed separate lawsuits seeking further action over their previous work on the deal.
It is unclear how and when these cases will be resolved. Even if the deal is finalized next week, Trump will not be able to sell any of his shares in the new company for six months, or use them as collateral, under terms he previously agreed to.
The deal is also set to provide a significant sum of $300 million in cash to Truth Social’s parent company. The social media company reported a loss of $10.6 million from its operations in the first nine months of 2023, on revenue of $3.4 million. The company financed itself by borrowing $40.7 million through convertible promissory notes payable in stock.
Based on how Digital World shares have been trading recently, TMTG would be valued at up to $5.7 billion following its merger with Digital World on a non-diluted basis and up to $8.6 billion on a fully diluted basis. diluted.
Source: Terra
Ashley is a professional author and journalist, working at 247 News Update. She writes on various topics from economy news to general interest pieces, providing readers with relevant and informative content. She brings a unique perspective and in-depth analysis to her work.
