After years of delays and regulatory hurdles, Trump Media & Technology Group finally made its public debut on March 26, 2024, through a SPAC merger with Digital World Acquisition Corp. The deal, valuing TMTG at a whopping $875 million including debt, raised eyebrows across Wall Street – and not just because of the company’s measly $3.6 million in revenue. The company debuted on the Nasdaq stock market.
The merger’s path was anything but smooth. SEC and FINRA investigations plagued the deal, scrutinizing communications between DWAC and TMTG. Meanwhile, DWAC’s CEO Patrick Orlando got the boot in March 2023, and the company’s mysterious links to China Yunhong Holdings raised more than a few questions. SPACs have faced increased market cautiousness following SEC guidance on financial reporting and governance issues.
TMTG’s crown jewel, Truth Social, hasn’t exactly set the social media world on fire since its rocky February 2022 launch. The platform, meant to rival Twitter and Facebook, stumbled through technical difficulties and leadership resignations. They even had trouble hiring – turns out some people aren’t thrilled about working for a politically charged startup. Financial analysts suggest reviewing the company’s profit margins and revenue growth for a clearer picture of its business health.
But none of that seemed to matter to investors. DWAC’s stock shot up an eye-popping 356.8% after the merger announcement. Trading had to be halted multiple times because things got so wild. Never mind the $400.9 million net loss in 2024 – who needs profits when you’ve got publicity?
The company’s leadership reads like a Trump administration reunion tour. Former congressman Devin Nunes ditched his seat to become CEO, and Donald Trump Jr. landed a cozy board position. With just 36 employees reported in 2023, it’s quite the lean operation.
Despite the drama – or perhaps because of it – TMTG managed to secure $293 million from DWAC’s trust for growth plans. The deal even includes a potential $825 million earnout in additional shares. Whether this translates into actual success for Truth Social remains to be seen.
But one thing’s certain: Wall Street hasn’t seen a SPAC merger quite like this before.
