Former President Donald J. Trump’s social media company — and the parent company of his favorite communications platform Truth Social — became a publicly traded company on Friday in a merger that will boost Trump’s wealth by billions of dollars and potentially help pay his mounting legal bills. .

Trump Media & Technology Group is ready for its debut on Wall Street at a market value of about $5 billion – based on the $37 share price of its merger partner, Digital World Acquisition Corp. Given that Mr. Trump owns more than 60 percent of the company, his total net worth will immediately increase by $3 billion — doubling his wealth from Forbes magazine’s estimate of $2.6 billion in October.

So far, those profits are on paper, and Trump is unlikely to be able to convert them into cash anytime soon because of restrictions in the merger deal that prevent large shareholders from selling shares or using them as collateral for their shares. loans. But because Mr. Trump controls so much of Trump Media, and because his allies are expected to make up the majority of the new administration, they could waive those restrictions at his request.

The question of where Mr. Trump can raise money has become urgent as he faces hundreds of millions of dollars in legal bills related to the many cases against him. Trump faces a deadline Monday to pay a $454 million fine in a civil fraud case brought by New York state’s attorney general, who accuses him of ballooning the value of his real estate holdings in deals with banks to have blown up.

If Mr. Trump cannot come up with the money or a bond to cover the fine while he appeals the ruling, the attorney general’s office could seize some of his property.

Trump Media’s board could be reluctant to allow Mr. Trump to sell shares early, as it would likely cause the company’s stock price to drop. But lifting the restriction on using shares as collateral would help him secure a bond and minimize the negative impact on the share price.

Before the merger was completed, Mr. Trump was chairman of Trump Media, but neither Digital World nor Digital World announced whether he will continue to hold the title. Either way, Mr. Trump will have enormous influence over the company, as the company’s new seven-member board of directors includes Mr. Trump’s eldest son, Donald Trump Jr., and three former members of his administration. His 79 million shares give him a large majority stake in the company and his brand is crucial to the success of Truth Social, which has become his main megaphone for communicating with his supporters.

There is no guarantee that Trump Media stock will continue trading at current levels. If the stock price falls in the coming months, the significant increase in his wealth over time may be smaller. Shares of Digital World fell about 14 percent after shareholders approved the merger.

As part of the merger, investors in Digital World – the cash-rich shell company that voted to merge with Trump Media – will now become shareholders in Trump’s three-year-old company. The deal will transfer more than $300 million from Digital World’s coffers to Trump Media, a struggling company with little revenue, and allow Truth Social to continue operating.

Trump Media shares could start trading on the stock market as early as Monday under the stock symbol DJT.

Many of Digital World’s 400,000 shareholders are regular investors and fans of Mr. Trump, whose enthusiasm for the former president has buoyed the stock for years. But it remains to be seen whether they will retain the shares now that the merger is complete.

In a statement before the vote, Trump Media said that “the merger will enable Truth Social to enhance and expand our platform.”

With the future of his real estate company in flux due to the verdict in the New York civil fraud case, Trump Media could become one of Trump’s top moneymakers — and a potential source of conflict if he were to become president in November. Trump Media currently gets most of its revenue from Truth Social, the flagship platform on which several start-up companies advertise their products, target Trump supporters and use slogans that are variations on America First or Make America Great Again.

By using the stock symbol DJT, Trump Media takes a trip back in time. One of Trump’s former publicly traded companies, Trump Hotels and Casino Resorts, traded under that stock symbol until it filed for bankruptcy in 2004.

The merger of Digital World and Trump Media, first proposed in October 2021, is one of the more prominent deals to emerge from a strategy many companies used to go public that was all the rage during the pandemic. Special purpose acquisition companies, such as Digital World, are speculative investment vehicles created for the purpose of raising money through an initial public offering and then finding an operating company to purchase.

By going public via a SPAC merger, Trump Media follows other so-called alt-right companies such as Rumble, an online video streaming service that targets right-wing media personalities, and PublicSquare, which bills itself as an online marketplace for the “patriotic parallel” economy.”

Trump Media received just $3.3 million in advertising revenue on Truth Social in the first nine months of last year, and the company posted a net loss of $49 million during that period.

“It’s unclear to me what the strategy is to build out the platform, especially so it can reach a broader advertiser,” said Shannon McGregor, a professor of journalism and media at the University of North Carolina. “There seems to be a ceiling in these niche markets.”

The merger was nearly derailed by a Securities and Exchange Commission investigation into deal talks between the two companies that took place before Digital World’s initial public offering. Securities rules prohibit SPACs from engaging in meaningful merger discussions before going public.

But the deal got back on track after Digital World reached a settlement with the SEC in July, agreeing to pay an $18 million fine after the merger was completed and to review company documents.

After the deal closed on Friday, many shareholders and Trump fans celebrated online. Chad Nedohin, an outspoken proponent of the merger on Truth Social, posted a livestream of the shareholder meeting on Rumble. In a chat room, viewers shared their excitement about the deal, with messages like “Great day to be alive” and “The day is finally here.”

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