Digital World Acquisition CorporationThe special-purpose acquisition company, which plans to take former President Donald Trump’s media company public, had scheduled a shareholder meeting on Tuesday as it aims to extend the deadline for the merger by up to a year.
The Trump Media and Technology Group and SPAC have come under increasing scrutiny in recent months. Federal investigation launched into possible securities violations on the deal. Fox Business reported Truth Social was in financial trouble and was unable to pay the vendor more than the $1 million it was contractually obligated to pay. Allegations denied by the company.
DWAC itself Warned shareholders that the former president’s declining popularity could hurt the dealIn fact, this vote is a sign that Mr. Trump illegally deleted thousands of White House documentsto his Mar-a-Lago private residence after he left the presidency, including those marked “Top Secret” and “Top Secret.”
Truth Social faces its own scrutiny. App has been removed from Google Play Store For violating the store’s policy on moderation of user-generated content. The platform will continue to be accessible online and through the Apple App Store.
DWAC and Trump Media are facing Thursday’s deadline to complete the merger, and SPAC is eagerly seeking an extension.
DWAC requires 65% of shareholders to approve the delay. DWAC CEO Patrick Orlando issued a barrage of pleas to shareholders through various channels, including Truth Social, urging them to approve the extension. Non-votes are basically counted as “down” votes.
Some of SPAC’s institutional investors, including Lighthouse Investment Partners and Pentwater Capital Management, did not comment on the upcoming vote when contacted by CNBC. Citadel Investment Group said it held the shares as a “market maker” rather than as a voting shareholder.
DWAC has previously warned that a “no” result could drive DWAC into liquidation. However, SPACs have built-in extensions of up to six months that sponsors can initiate by adding funds to the trust.
ARC Global Investments, an Orlando company, holds 20% of those voting rights, he said. Interview with IPO Edge last ThursdayStill, he said, “retail shareholders carry a lot of weight.”
The Trump Media and Technology Group and Truth Social were formed after Trump was banned from Twitter following the January 6, 2021 Capitol riots. That day, his supporters stormed the building in an attempt to block recognition of Joe Biden’s victory in the 2020 presidential election.
trump media Announced in October 2021 It will merge with DWAC and take the company public. Trump Media, led by former Republican Congressman Devin Nunes, said it also plans to launch TMTG News and TMTG+ video streaming services.
The merger’s high profile has brought in more retail investors than SPACs normally attract. Few SPAC institutional investors responded to requests for comment.
For investors, the liquidation of DWAC will pay out about $10 per share. Shares of the so-called Blank Check company have recently traded at around $25. This is far from his March 2022 peak of around $97. Low voter turnout in shareholder ballots can wreck deals.
“specification #rocktheproxy‘” Florida-based Orlando said in one of many Truth Social posts during the voting period.
When asked about the investigation into the DWAC-Trump Media deal, Orlando said DWAC was “aware of many targets” prior to the offering, and said the company had complied with all investigation requests.
“If there is an inquiry, we will answer the inquiry.
The DWAC CEO also said Trump will remain chairman of Trump Media. He reports he left the board weeks before the company was subpoenaedOrlando reiterated the potential risks posed by Trump’s volatile public popularity.
“There are risk factors. We need to let people know that these are things to consider,” Orlando told IPO Edge. “If certain negative events occur, they will have a negative impact on the stock.”
The results of the shareholder vote are due to be announced on Tuesday, unless the company decides to postpone the meeting.
– CNBC’s Yun Li contributed to this report.