Investors voted on Sept. 5 to give the special purpose acquisition company that intends to merge with former President Donald Trump’s Truth Social parent company more time to finalize the union following multiple delays.
More than 72 percent of shareholders with Digital World Acquisition Corp. (DWAC), a special purpose acquisition company, agreed to grant an additional 12 months to finalize its plans with President Trump’s media startup, Trump Media & Technology Group (TMTG).
Eric Swider, CEO of Digital World, said in a statement announcing the extension: “We are immensely grateful to our stockholders and our working group for their continued trust and support. This vote underscores their confidence in the potential merger with TMTG and the path we’ve set for the future. With many of our headwinds behind us we look forward to working with TMTG and our dedicated team to complete this transaction as quickly as possible.”
TMTG CEO Devin Nunes also welcomed the vote. “With this vote of confidence from DWAC shareholders, we will proceed as quickly as possible to complete our merger, which we expect will open up tremendous new opportunities to grow and expand TMTG and the Truth Social platform,” he said.
Digital World entered into a merger agreement with TMTG, the parent company of social media platform Truth Social, in October 2022, but the deal has been hit with multiple delays, including investigations by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC).
Digital World Reaches $18 Million Settlement
If the extension hadn’t been granted, the deal itself would have effectively been wiped out and Digital World would have been required to liquidate and return the $300 million that it raised to shareholders, Reuters reported.
Both companies recently reaffirmed their plans to merge after Digital World reached a tentative settlement of a penalty of $18 million with the SEC to settle charges alleging that the company violated anti-fraud provisions.
Prior to the settlement, Truth Social had asked Congress to investigate the SEC over delays to the merger, which it alleged were being caused by “egregious conduct and blatant politicization.”
Trump Lawsuits Mount Up
However, neither President Trump nor his company faced any charges in relation to those allegations.Digital World’s stock was trading up by 3.63 percent as of Sept. 6 at $17.11, but it’s still trading down substantially from its peak of about $97 per share in March 2022.
The extension comes as President Trump—who controls 90 percent of TMTG—is currently facing a string of charges over his alleged efforts to challenge the results of the 2020 election in Georgia and elsewhere.
President Trump, The Trump Organization, and three of President Trump’s adult children are also facing a multimillion-dollar civil lawsuit filed by New York Attorney General Letitia James that alleges “years of financial fraud to obtain a host of economic benefits,” including fraud and misrepresentation of financial statements as part of an alleged effort to deceive insurers, tax officials, and lenders by inflating the value of President Trump’s properties, including his Mar-a-Lago estate in Florida.
President Trump has denied all wrongdoing.
