Former President Donald Trump is in the spotlight once again, as he pleads with his followers to help raise over $450 million for his civil fraud case bail. Trump, who risks having his properties seized, is facing challenges in obtaining the necessary funds. However, Trump is on the brink of a lucrative deal that could make him $3.4 billion richer.
A shareholders meeting of Digital World Acquisition Corp (DWAC) is set to vote on a merger with Trump Media & Technology Group (TMTG), which owns the social network Truth Social. The price of DWAC shares has skyrocketed, with the company becoming a meme stock driven by market speculation rather than economic fundamentals.
Despite the potential windfall from the merger, TMTG has minimal revenue and significant losses. The company’s financials reveal a turnover of $3.4 million and losses of $49 million between January and September 2023.
The approval of the merger is not guaranteed, as a wayward shareholder controlling almost 15% of the capital poses a challenge. DWAC has filed a lawsuit against the shareholder to ensure a favorable vote for the agreement.
If the merger proceeds, Trump’s ability to sell his shares will be restricted for the first six months. The market’s valuation of the company remains a point of contention, with concerns about a collapse if the valuation does not align with investors’ expectations.
The merger deal highlights Trump’s control over New Digital World, with the former president set to control at least 58.1% of the voting rights. TMTG intends to utilize the funds from the merger to fuel its growth and attract Republican voters to its network.
Trump founded Truth Social after being banned from Twitter and Facebook. Despite his return to Twitter following Elon Musk’s purchase of the platform, Trump’s presence on social media remains a key factor for TMTG’s success.
As the merger decision looms, the potential risks and uncertainties surrounding Trump’s involvement in TMTG continue to be a focal point. The company’s reliance on Trump’s popularity and credibility underscores the challenges ahead for the business.
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