Former President Trump’s planned launch of a social media platform drew strong interest from investors on Thursday, causing shares of SPAC company Digital World Acquisition Corp. to surge 357% on news of a planned merger.
DWAC’s stock closed at $45.50 per share in trading on Nasdaq. Trading on the shell company was halted multiple times throughout the day due to volatility.
|DWAC||DIGITAL WORLD ACQUISITION CORP.||94.20||+48.70||+107.03%|
The former president said his social media platform would be publicly traded following a merger between the newly formed Trump Media & Technology Group and DWAC. Dubbed “Truth Social,” the platform is set to debut a beta version in November and roll out nationwide during the first quarter of 2022.
Once the merger is complete, Trump Media & Technology Group will have an initial enterprise value of $875 million. Trump’s personal stake in the company was not immediately clear.
Inquiries by FOX Business to TMTG and Digital World Acquisition Corp. were not immediately returned.
Trump was banned from prominent platforms such as Facebook, Twitter and YouTube following the Jan. 6 Capitol riot. The companies argued the former president had violated their policies against inciting violence.
Trump said he started his social media initiative to “stand up to the tyranny of Big Tech.”
“We live in a world where the Taliban has a huge presence on Twitter, yet your favorite American President has been silenced. This is unacceptable,” Trump said in a statement. “I am excited to send out my first TRUTH on TRUTH Social very soon. TMTG was founded with a mission to give a voice to all. I’m excited to soon begin sharing my thoughts on TRUTH Social and to fight back against Big Tech. Everyone asks me why doesn’t someone stand up to Big Tech? Well, we will be soon!”
SPACs, or special purpose acquisition companies, have gained popularity in recent months as a method to quickly take a company public without a traditional initial public offering. SPACs are formed to identify acquisition targets that align with their interests.
DWAC’s trading volume is the largest for a SPAC merger announcement on record based on available announcement data from SPAC Research, per Dow Jones Market Data Group.
“Digital World was formed to create public shareholder value and we believe that TMTG is one of the most promising business combination partners to fulfill that purpose,” DWAC Chairman and CEO Patrick F. Orlando said in a statement. Orlando is a former executive at Deutsche Bank.