Trump's Social Media Venture Seeks to Raise $1 Billion

- 03 December 2021 20:20 WIB
Former U.S. President Donald Trump and VP Mike Pence.
Former U.S. President Donald Trump and VP Mike Pence.

JAKARTADAILY.ID - Former U.S. President Donald Trump's new Social media venture is attempting to raise up to $1 billion by selling shares to hedge funds and family offices, according to a report by Forbes on Friday (December 1, 2021).

The Trump Media and Technology Group is searching for funds through private Investment in public equity (PIPE) by selling shares valued at roughly $3 billion. The amount is three times the $875 million valuation the firm claimed in October when it announced a planned merger with Digital World Acquisition Corp (DWAC), a publicly listed special purpose acquisition company.

Following the news, DWAC shares soared 550 percent from approximately $10. After the initial jump in mid-October, however, the stock's price has gradually declined, implying that many Trump fans who purchased at the peak of the mania are now sitting on losses. The stock is recently trading around $40.

The increased valuation of the PIPE sought by Trump's company would result in substantially more dilution of existing DWAC investors' holdings than is typical in SPAC deals.

DWAC shares rose more than 15 percent from $38.50 Wednesday afternoon to close at $44.35 on Thursday and eventually went past $50 after hours.

Trump has reportedly been personally calling possible investors, seeking commitments of more than $100 million, to sources familiar with the preparations.

The company's signature product will be TRUTH Social, a new Social media network, which he intends to use to reclaim his Social media presence and serve as the company's chairman.

It was said in October that there would be a beta launch of the website in November, followed by a complete rollout next year, but there has been no indication of any form of a public test launch.

Editor: Mukhtar Wijaya

Source: Forbes


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