Donald Trump stands to see his wealth increase by approximately $3.4 billion (£2.7 billion) pending a shareholder vote this Friday, facilitating the potential floatation of his Trump Media business. The former US president is poised to list Trump Media & Technology Group, which oversees the Truth Social tech platform, through a merger with a special purpose acquisition company (Spac).
Digital World Acquisition, the Spac responsible, has slated a vote for Friday on the merger with Trump Media, though complications arise as Digital World has sued sponsor ARC Global Investments in an effort to thwart delays to the deal. Should the merger proceed and Trump Media go public as early as next week, Trump, the presumptive Republican presidential nominee, would face restrictions on immediate cashing in, as major shareholders are prohibited from selling stock for six months as per the merger agreement.
Trump’s financial landscape faces strain as he gears up for a potential second presidential bid against incumbent Joe Biden. Just recently, Trump was ordered by a New York judge to pay $454 million following a civil fraud case, wherein he was found to have manipulated property values to secure favorable loan and insurance rates.
Julian Klymochko, CEO of Accelerate Financial Technologies, noted the sway of Trump’s electoral prospects on Digital World Spac’s trading, emphasizing its surge in January correlating with Ron DeSantis’s withdrawal from the race. He characterized DWAC not as a conventional stock based on fundamentals, but rather as a meme stock reflecting bets on Trump’s electoral success.
The merger agreement includes a standard provision preventing “founder share” owners like Trump from selling their stock until six months post-deal completion, aimed at averting a flood of shares onto the market and subsequent price suppression after listing.
