Digital World Acquisition Corp. (DWAC) stock fell early Wednesday as the special-purpose buyout firm took a hit after Tuesday’s midterm elections were read by some as rejections of candidates backed by former President Donald Trump.
While some major races were still undecided, Republicans looked poised to have a narrow majority in the U.S. House of Representatives. However, the election results fell well short of GOP expectations for a “red wave” that brought majorities in both chambers of Congress. With some candidates endorsed by Trump underperforming, several Republican political observers assumed that voters were cooling off to the former president.
DWAC aims to take the former president’s tech and social media platform to the public in the reverse merger genre that was popular a few years ago. DWAC stock fell 19% on Wednesday market trading Wednesday. shares Monday rose almost 70% In the news, Trump will announce another nomination for the White House this month.
At a rally in Ohio on Tuesday night, Trump said he would make “a very big announcement” next week.
“I’m going to make a very big announcement on Tuesday, November 15,” Trump said before the election results started coming in.
DWAC Stock and the Trump Brand
The future of DWAC and its efforts to take the Trump Media and Technology Group public are firmly rooted in the value of the Trump brand. Trump Media is the parent of conservative social media platform Truth Social.
The wins of Trump-backed Senate candidates JD Vance in Ohio and Ted Budd in North Carolina were positive from the Trump brand. But a long list of casualties raises questions about Trump’s waning power, as Mehmet Oz loses the Pennsylvania Senate nomination and Trump’s protege Kari Lake falls behind in the late Arizona governorship race.
Given the skepticism posed by the midterm results, another presidential race is the clearest short-term way to strengthen Trump’s brand appeal.
DWAC shares rise after SPAC last week delayed shareholder vote – for the sixth time – on whether to approve a one-year extension to complete its merger with Trump Media.
The shareholders meeting is now set for November. 22. The deadline for DWAC to complete its merger with Trump’s company was originally in early September. However, SPAC claimed that the Securities and Exchange Commission’s investigation into the deal delayed transactions.
DWAC Financial Difficulty
As DWAC shareholders failed to complete the vote in September, SPAC’s sponsor, ARC Global Investments, contributed approximately $2.9 million to extend the merger deadline until December. 8, according to federal filings. The vote, organized by DWAC management, gives shareholders the opportunity to extend the deadline until September. 8, 2023.
Now that DWAC has funding, SPAC has until December. 8 this Get the votes to approve the extension.
DWAC warned investors that the company could potentially cease operations and liquidate shares if no extension is made for the year.
Federal filings also show that SPAC has lost cash. In an SEC document, DWAC revealed this between Sept. 19 and September 23 had received notices of termination from private investments to public equity (PIPE) investors representing approximately $139 million.
This comes after DWAC reported it in its quarterly report in August. He announced that he lost $6.2 million in the first half of 23 years.
Musk’s DWAC Stock in Charge of Twitter
Here’s how DWAC stock performance comes in this week: tesla (TSLA) chairman Elon Musk is now officially in charge of Twitter.
Musk began running the social media platform with mass layoffs, cutting off about 50% of the company’s workforce. It also rolled out a $7.99 monthly fee that includes blue check verification and other social media perks.
Musk 19.5 million Tesla shares sold $4, 7 and 8 for $3.95 billion on November, according to SEC filings late Tuesday. The decision to sell some of Tesla’s shares comes just days after Musk finalized his $44 billion Twitter purchase.
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Musk was signaling that people banned from the social media platform, including Trump, could be reinstated. This could be a deathblow for Truth Social, but Trump said he plans to stay on his platform.
“I stay in Reality. I like it more, I like the way it works. I like Elon, but I stay in Truth,” Trump told Fox News Digital in late October.
DWAC Stocks Well Covered Highs
Truth Social was launched after Twitter shut down Trump’s account after January 1. 6th uprising in the US Capitol. Some industry watchers argue that a return to Twitter could divert a large portion of Truth Social’s viewers to a more mainstream channel.
DWAC stock is down 90% from October. January 22, 2021, 175 high, marked just after news of the Trump merger deal first broke.
Please follow Kit Norton on Twitter @KitNorton for more coverage.
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