DWAC shares fall as Trump takes office

Digital World Acquisition Corp. ( DWAC ) shares fell on Wednesday after former President Donald Trump announced Tuesday that he will seek the 2024 Republican presidential nomination.


“To make America great and great again, I am announcing my candidacy tonight for the presidency of the United States,” Trump told supporters at an event at Mar-a-Lago.

DWAC shares fell more than 16% during market trading on Wednesday. DWAC shares fell 8.8% on Tuesday before Trump said he would run for president. The stock rose 11% on Monday and is up nearly 52% for the month of November.

DWAC is a special purpose buyout company that aims to take the former president’s tech and social media platform public in a reverse merger that was popular a few years ago. The company reported on Monday that it continues to bleed cash. The SPAC said it lost about $3.4 million in the most recent quarter ended Sept. 30, according to SEC filings. The group has lost $9.6 million so far in 2022.

DWAC Equity and Trump Brand

The future of DWAC and its efforts to take Trump Media and Technology Group public is closely tied to the value of the Trump brand. Another presidential bid is seen as a big boost for the brand. Trump Media is the parent of Truth Social, a conservative social media platform.

DWAC shares fell 20% last week after the midterm elections, as Republicans fell well short of expectations. The performance was read by some as a rejection of Trump-backed candidates. DWAC shares jumped nearly 70% earlier in the week on news that Trump would announce his presidential bid.

Tuesday’s victories by Trump-backed Senate candidates JD Vance in Ohio and Ted Budd in North Carolina helped boost the Trump brand. But a long list of losses raised questions about Trump’s potentially declining wattage, with Mehmet Oz losing his Senate bid in Pennsylvania and Trump protege Kari Lake falling far enough behind in the Arizona gubernatorial race that Fox News and the Associated Press called the race for her challenger. Katie Hobbs.

Given the doubts raised by the midterm results, another presidential election is the clearest short-term way to bolster Trump’s brand appeal.

DWAC shares rose after the SPAC postponed a sixth shareholder vote in early November to approve a one-year extension to complete its merger with Trump Media.

The shareholders’ meeting is now set for November 22, but the business hours are moving forward. DWAC’s deadline to complete its merger with Trump’s company was originally set at the beginning of September. However, the SPAC argued that the Securities and Exchange Commission’s investigation of the deal delayed the proceedings.

DWAC Financial Challenge

When DWAC shareholders failed to complete a vote in September, the SPAC’s sponsor, ARC Global Investments, contributed about $2.9 million to extend the merger deadline until Dec. 8, according to federal filings. A vote organized by DWAC management allows shareholders to extend the deadline to September 8, 2023.

Now that DWAC has funding, the SPAC has until Dec. 8 to gather votes to approve the extension.

The president’s proposal may be enough to urge shareholders to vote to extend the deadline. Otherwise, DWAC warned investors that if a one-year extension is not granted, the company could potentially cease operations and liquidate shares.

In an SEC filing, DWAC revealed that between September 19 and September 23, it received termination notices from private investments in public equity (PIPE) totaling approximately $139 million. In its quarterly report on August 23, it reported a loss of $6.2 million in the first half of the year. And according to his latest filing, he continues to lose millions of dollars.

DWAC shares with Musk in charge of Twitter

Here comes the recent volatility of DWAC stock Tesla ( TSLA ) CEO Elon Musk headed Twitter.

Musk has cut nearly half of the social media site’s staff while frequently tweeting about his plans and policies. Musk also personally responded to customer complaints and suggestions. There has been widespread confusion over the rollout of the verification features and speculation that the company may go bankrupt.

Musk’s focus on Twitter is hurting Tesla stock, according to some analysts. Tesla shares have fallen more than 10% since Musk bought Twitter on Oct. 28.

Musk also sold 19.5 million Tesla shares for $3.95 billion on November 4, 7 and 8. The decision to sell some of Tesla’s stock comes just days after Musk finalized his $44 billion purchase of Twitter.

Musk hints that people banned from the social media platform, including Trump, could be reinstated. This could be a fatal blow to Truth Social, but Trump has said he plans to stick with his platform.

“I stand by the Truth,” Trump told Fox News Digital in late October.

“I like Elon, but I stay in Truth,” he said.

DWAC shares have hit a high

Truth Social was launched after Twitter suspended Trump’s account on January 6 following a riot at the US Capitol. Some industry observers argue that a return to Twitter could divert a large portion of Truth Social’s audience to a more mainstream channel.

DWAC shares have fallen 84% to 175 since Oct. 22, 2021, the day Trump announced the merger deal.

Follow Kit Norton on Twitter @KitNorton for more coverage.


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