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SEC Clears Trump Media Merger with Digital World Acquisition

 |  February 15, 2024

The U.S. Securities and Exchange Commission (SEC) has given the green light for the merger between Digital World Acquisition Corp. (DWAC) and Trump Media & Technology Group (TMTG), the media and technology company spearheaded by former U.S. President Donald Trump.

Digital World Acquisition Corp. announced on Thursday that the SEC had declared effective the registration statement for its proposed merger with TMTG, which operates the social media platform Truth Social. This move paves the way for what could be a transformative deal, with Trump expected to hold a substantial stake of approximately 58% in the newly-formed company, reported Reuters.

The market responded with enthusiasm, as DWAC shares soared nearly 30% during Thursday morning trading. The stock was last seen trading up 20% at $52.16, reaching a session high of $56.30. The ripple effect was felt across related sectors, with shares of video-sharing platform Rumble, favored by conservatives, witnessing an uptick of nearly 11%. Similarly, software developer Phunware, which was contracted by Trump’s 2020 presidential re-election campaign to develop a phone app, experienced a 1% rise. Phunware notably emerged as one of the most traded stocks across all major U.S. exchanges.

Digital World Acquisition Corp. stated its intention to announce the date of a special meeting of its stockholders to vote on the approval of the merger within two business days. However, representatives for DWAC did not immediately respond to requests for comment on the matter.

The surge in DWAC’s stock price has been remarkable, with gains exceeding 150% since January 15. This date coincides with Trump’s victory in the Iowa caucus, signaling his resurgence as a prominent figure in Republican politics and reigniting speculation about his potential candidacy for the upcoming presidential election.

The impending merger between DWAC and TMTG represents a convergence of political influence and corporate maneuvering, with implications that extend beyond the financial realm. As Truth Social prepares to enter the social media landscape, observers anticipate heightened scrutiny amid ongoing debates about online discourse and the role of tech platforms in shaping public discourse.

Source: Reuters