Trump supporters could lose millions after deal to buy Truth Social goes south
According to a report from The Young Turks’ Matthew Sheffield, supporters of controversial former President Donald Trump could lose millions of dollars invested into Digital World Acquisition Corp. (DWAC), an acquisition company, or “blank check” firm seeking to purchase Trump’s Truth Social platform to take it public. Now, DWAC faces a liquidation deadline with little progress on completing the deal, meaning those investors could be left in the lurch.
via Twitter
The report explains:
“In a call with investors, Patrick Orlando, the chairman and CEO of the struggling shell company announced that DWAC was going to reconvene on Nov. 22. It was an ominous sign that Digital World had failed to receive authorization from 65% of shareholders to continue the company’s existence, despite months of trying. Under the terms of DWAC’s incorporation, the company was supposed to merge with a private firm within one year’s time or dissolve and reimburse its investors at a rate of about $10 per share.”
And continues:
“Liquidation appears more likely to be DWAC’s fate as Trump himself appears increasingly uninterested in the company (or its stockholders) as it has struggled to defend itself from a criminal investigation that executives engaged in prohibited insider trading and a separate inquiry from the Securities and Exchange Commission about allegations of illegal contact between DWAC officers and the leadership of Trump Media and Technology Group (TMTG).”
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After purchasing DWAC at $90 a share, many of Trump’s followers who invested might be taking quite a financial hit:
“In remarks posted on Truth Social after the latest postponement, members of the site expressed increasing frustration with DWAC’s leadership. We are all in the dark and have no idea what’s going on after multiple extensions,’ one member wrote. ‘I agree this is BS!’ another user replied. ‘I love Truth Social but I can honestly say that I’ve never seen anything like this in my life! Guess our stock is fixin to drop lower on the news!'”
Truth Social was founded as the MAGA alternative to Twitter after Trump was banned from the platform for his role in inciting the violence at the U.S. Capitol on January 6, 2021.
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One of the founders of TMTG has allegedly violated securities laws and has been accused of improper pressure to transfer shares of the company to former First Lady Melania Trump, while Orlando faces a fraud lawsuit by a former executive at DWAC, alleging that he was improperly pushed out of the original deal.
