Donald Trump Media Company, belonging to the former US President, is set to receive a $1 billion investment after its merger with Digital world Acquisition Corp.
The first announcement of the merger with the blank check acquisition firm was in October by Trump. This move will help him regain his social media presence after being ejected from the Facebook and Twitter platforms.
As per Bloomberg news, the newly merged entity will be operational by the first quarter of 2022 and plans to start a new social media company named Truth Social.
The merger will result in deploying $1.25 billion from the investments to fund the operations of the combined entity, Trump Media and Technology Group Corp, in a joint press release Saturday. The price conversion ratio will be adjusted according to the share earnings of Digital World.
Trump said that a $1 billion investment would send a strong signal to the Big Tech, adding to his earlier accusation of political discrimination and censorship.
According to him, TMTG, the combined entity, will be in a stronger position to fight the big tech after their Balance sheets expand.
Matt Levine, a Bloomberg columnist, informed that Trumps’ company had not provided any updates on its plans, operations details, or financials. The deal with the Digital world is yet to close. He said that Trump would get his money for the transaction points to retail investors and political allies giving $44 for the right to give $10 to Trump.
Some investors have already gained from the planned deal. Bruce Kallins, a Hedge Fund Manager, gained around 12% in October, his company Yakira’s best performance in his three-decade career and much better than his peers. His fund got boosts from its stake in Digital World after the announcement of the merger with Trump’s company.
Yakira was the best performer among the 67 event-driven funds tracked by BarclayHedge, an industry research firm. The returns were double than the next best performer in the category, according to Sol Waksman, president of BarclayHedge.
Donald Trump teased earlier that he might run for the presidency again in 2024 without any formal announcement. He was banned by social media companies like Twitter and Facebook for his role in encouraging his supporters to break into U.S. Capitol Hill on January 6 early this year when both the houses of Congress were meeting to certify Joe Biden’s victory in the December 2020 presidential elections.
