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Trump Media & Technology Group, Donald Trump's media company that runs his social media platform Truth Social, might miss the opportunity of receiving nearly $1.3 billion if a merger plan with blank-check company Digital World Acquisition Corp. (DWAC) fails.
DWAC, which is a Special-Purpose Acquisition Company (SPAC), plans to take the former president's media company public and is currently seeking to extend the deadline for the merger in order to have more time to gather shareholder votes, Markets Insider reported Friday.
If the deal is successfully completed, Trump's media company would receive $293 million from DWAC in addition to $1 billion in the form of a private investment in public equity (PIPE).
The company adjourned its shareholder meeting until October 10 to give shareholders more time to vote in favor of delaying the merger, DWAC said in a press release on Thursday.
Without the needed support of enough shareholders, DWAC is prone to liquidation and would be expected to give back the money it raised in its initial public offering.
The company would need 65 percent of its shareholders to vote in favor of offering more time for the company to finalize its merger with Trump's company.
The initial merger completion deadline was Thursday. However, DWAC wants to have a three-month extension applied four times, bringing the total extension period to 12 months, which would end on September 8, 2023, according to the press release. The first three-month extension would end this year on December 8.
"The Extension Amendment would effectively provide for an additional six months, past the two three-month extensions currently permitted by the Company's existing governing documents, to complete a business combination," the company said in the press release.
Newsweek reached out to Digital World Acquisition Corp. for comment.
DWAC lost around $6.5 million during the first half of 2022 as the company warned against Trump's potential "adverse" impact on operations.
"If President Trump becomes less popular or there are further controversies that damage his credibility or the desire of people to use a platform associated with him, and from which he will derive financial benefit, TMTG's results of operations, as well as the outcome of the proposed Business combination, could be adversely affected," the company said in a recent U.S. Securities and Exchange Commission (SEC) filing.
Truth Social was founded by Trump after he was permanently banned from Twitter following the Capitol riot on January 6, 2021.
Last month, the former president said that Truth Social is not facing financial setbacks or other problems. However, the U.S. Patent and Trademark Office declined his application to trademark the name "Truth Social," because the wording is already used by two other companies.
"The Fake News Media is devastated by how well TRUTH is doing so, quite on cue, they are working overtime to criticize and demean it. Actually, many of the big guns in Washington, D.C., are fighting to stop the TRUTH but, they won't be successful. They are going after the outside financial company, and virtually anybody that walks and breaths, but that won't do it. They said it is doing worse since the Raid, but actually it is doing MUCH better, up more than 550%. We all love TRUTH!!!" the ex-president wrote in a post on Truth Social.
About the writer
Fatma Khaled is a Newsweek weekend reporter based in New York City. Her focus is reporting on U.S. politics, world ... Read more