The future of former President Donald J. Trump’s social media platforms remains in doubt after the cash-rich companies that wanted to merge announced on Tuesday they needed a few more days to gain shareholder support. . handle.
Digital World Acquisition had scheduled a meeting on Tuesday to announce the results of a shareholder vote to extend the deadline for completing the merger by another year. Shortly after the conference began, however, Digital World CEO Patrick Orlando announced that the conference would be postponed to Thursday to give investors more time to vote.
If the Special Purpose Acquisition Company (SPAC) fails to get 65% shareholder approval, it will be forced into liquidation, returning to shareholders about $300 million raised in last September’s initial public offering. The liquidation also means that the roughly 30 hedge funds that have pledged to provide $1 billion in additional funding will not need to have that cash on hand.
A potential collapse of the deal calls into question the future of Trump Media & Technology Group and its flagship social media app, Truth Social. , the attack on the Capitol.
Digital World, which went public a year ago, had completed a merger with another company by Thursday, September 8th. Dual investigations into the deal by federal prosecutors and securities regulators have stalled and delayed the merger.
Without an infusion of cash from Digital World, Trump Media may need to raise additional funding or find another merger partner.
Meanwhile, Rumble, one of Trump Media’s primary business partners, is nearing completion of its own merger with SPAC. September 15, CF Acquisition Corp. VI I plan to announce whether I am a shareholder has approved a merger with Rumble, an online video platform that offers a conservative alternative to YouTube.
After the announcement, Digital World’s share price fell by about 15%. Closing just over $22, he’s down more than 11% on the day.