Donald Trump’s Truth Social platform may be headed to a Wall Street listing, something that has been in the works for more than two years.
The Securities and Exchange Commission has signed off on one of the last obstacles to a merger to take the former president’s media brainchild public, according to the companies behind the deal, Trump Media & Technology Group and Digital World Acquisition Corp.
The platform is intended to be an alternative to mainstream social media platforms such as Twitter and Facebook, which banned Trump after the January 6 attack on the US Capitol by his supporters.
The deal has faced several challenges, including investigations by the US Department of Justice and the Securities and Exchange Commission (SEC), which charged DWAC with making material misrepresentations in filings to the SEC as part of DWAC’s initial public offering and proposed merger with TMTG. DWAC reached an $18 million settlement with the SEC in July 2024.
The platform is the result of a merger between TMTG and Digital World Acquisition Corp (DWAC), a blank-check acquisition company that seeks to take private companies public . The deal, which was first announced in October 2021, is expected to inject some $300 million into TMTG and give Trump a stake of about 58% in the newly formed company.
The SEC cleared the way for the merger on February 15, 2024, pending final approval from investors. The shares of DWAC soared nearly 30% on the news, and were trading at $52.16 as of February 16, 2024. The platform has attracted 6.61 million followers as of February 16, 2024, including Trump himself, who has used it to communicate with his supporters and promote his campaign for the 2024 presidential election.
“I never thought it would get to this point,” said Julian Klymochko, CEO of Accelerate Financial Technologies, which operates a fund focused on so-called blank-check companies like Digital World that seek to acquire private companies to take them public. “Deals die on the vine, but this one somehow managed to survive despite seemingly everything going against it.”
The SEC’s green light is a surprising outcome for the imperiled media outlet at a time when the former president is embroiled in multiple trials and legal actions that are draining his financial resources.
From a different perspective, this latest development of the deal that no one expected to go through has been illuminating. “Up until this point, there’s been a lot of hype, excitement and trading on the Trump name and persona,” University of Georgia law professor Usha Rodrigues said. “The whole DWAC story has shown us that there is a piece of the market that will buy because he says buy.”
