Investors Approve Trump's $5.7 Billion Social Media Deal

Former U.S. President Donald Trump is on the brink of a significant financial gain with his social media firm, as investors in a blank-check acquisition company have approved a deal worth approximately US$5.

7 billion. The agreement values Trump's majority stake in Truth Social, his app, at around US$3.3 billion.

This windfall comes at a crucial time as Trump faces financial challenges due to ongoing legal battles, including a massive US$454 million judgment in a civil fraud case in New York. Digital World Acquisition Corp (DWAC), the SPAC behind the merger with Trump Media & Technology Group (TMTG), received approval from shareholders on Friday. The next step is to finalize the deal, although uncertainties loom large.

Former Digital World CEO Patrick Orlando and Trump's former business associates have filed lawsuits to block the merger, claiming they are entitled to more shares based on their previous contributions. The resolution of these legal disputes remains unclear. Even if the deal is completed next week, Trump will be subject to restrictions, including a six-month lock-up period during which he cannot sell his shares or leverage them.

However, the agreement is set to inject US$300 million in cash into Trump Media & TMTG, which has been sustaining losses and borrowing funds to stay afloat. With the current trading value of Digital World's shares, TMTG could be valued at up to US$8.6 billion on a fully diluted basis post-merger.

The surge in Digital World's stock price since announcing the merger with TMTG has been fueled by Trump supporters and retail investors. Despite a temporary drop in Digital World's shares after the shareholder approval, the potential valuation of the combined company is significant, albeit lower than Elon Musk's popular social media platform X. Trump's social media platform, Truth Social, has garnered 6.

7 million followers, a fraction of his previous following on X. The platform was established as a means for Trump to engage with his supporters following his ban from mainstream social media platforms in the aftermath of the Capitol attack in January 2021. Trump's ownership stake in the combined company, which could range from 58.

1 percent to 69.4 percent depending on investor support, positions him for a substantial influence over the future direction of the entity. TMTG was conceived as a platform for Trump to communicate with his base, particularly after his removal from major social media platforms.

Despite the hurdles and controversies surrounding the deal, including investigations by regulatory authorities and leadership changes within Digital World, the merger with TMTG is set to proceed. Trump's use of Truth Social as his primary communication channel underscores the platform's significance in his political ambitions, especially as he eyes a potential return to the White House. In conclusion, the approval of the merger between Digital World and Trump Media & Technology Group signifies a major milestone for Trump's foray into the social media landscape.

The financial implications of this deal could have a profound impact on Trump's personal wealth and his future endeavors in the political arena. As the saga unfolds, all eyes will be on Truth Social and its role in shaping the digital landscape for Trump and his supporters.