The funding partner for Trump Media & Technology Group said it has received regulatory approval from securities regulators that will allow it to proceed with a long-delayed merger. The combination could provide former President Donald Trump with a stake worth almost $4 billion.
Digital World Acquisition Corp. (DWAC), a so-called special-purpose acquisition company, said Thursday in a statement that the Securities and Exchange Commission had signed off on its proposed merger with Trump Media. DWAC said it plans to announce within two days a date for shareholders to vote on the deal.
The SEC said it doesn’t comment on individual issuers.
Clearing this regulatory hurdle amounts to a major win for Trump and his media business, which runs the conservative-leaning Truth Social platform. The merger has been in the works since October 2021, but had stalled because of regulatory concerns and other roadblocks.
The plan has been for DWAC to merge with Trump Media, providing the former president’s fledgling business with capital to expand its operations. But as the merger process dragged on, DWAC returned hundreds of millions of financing commitments to investors.
If the merger is completed, Trump would own nearly 79 million shares in the new business, or as much as 69% of the combined company, a DWAC filing shows. That stake could be worth as much as $3.95 billion based on DWAC’s stock price on Thursday.
On Friday, the former president faced a major setback when the judge in his civil fraud trial banned Trump for three years from running the New York-based company that for decades has served as the hub of his global business empire. Trump and The Trump Organization were also ordered to pay penalties of $354 million in what is one of the stiffest corporate sanctions in New York history.
Shares of DWAC fell 4% on Friday.
“Moving forward, we aim to accelerate our work to build a free speech highway outside the stifling stranglehold of Big Tech,” said Trump Media CEO Devin Nunes, a former Republican House member, in the statement accompanying DWAC’s announcement about securing SEC approval to move forward with the deal.
For the first nine months of 2023, Trump Media had revenue of $3.4 million, up from $237,000 in the year-ago period.
