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Donald Trump’s Social Media Venture Falls 13% as Twitter Announces Deal With Musk

Digital World Acquisition Corp.’s shares, the blank-check company prepared to acquire a media venture public by Donald Trump, sank in unstable trading on Monday, April 25, 2022. It happened following the announcement that came out from Twitter regarding a take-private pack with Elon Musk.

Yesterday, the stock fell by 12.9 percent, which brought its year-to-date losses to more than 30 percent. The special purpose acquisition company is underway to team up with the then-president’s Trump Media & Technology Group.

More About Media Venture

The media project consists of a social media platform named Truth Social, which was introduced in February on the Apple App Store.

Trump’s company is being promoted as a substitute to other social media platforms: Twitter and Facebook, for the unversed, both platforms have banned Trump as a consequence of provoking January 6, 2021, insurrection at the U.S. Capitol. However, the start of this new project has been rough, troubled by technical issues and also the exit of key executives.

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The liquidation in shares is perhaps linked to news that Musk’s proposal to buy the social media company has been accepted by Twitter’s board. Musk offered to acquire it privately for $54.20 per share, which equates to $44 billion. The Tesla CEO pledged to update the policies of the platform on censorship, stating that he will improve the platform with new attributes and the algorithms open source to build up trust.

On Monday, former US president Trump told Fox News that he will not get back to Twitter even though Musk’s pact pulls off. He added that he will begin to use the application of his own company. Since the time the application was launched, Trump just published once on Truth Social.

Despite a weak 2022, DWAC shares, which generally trade in a volatile range, have more than tripled in value since its launch in September at $10 per share.

DWAC is a professed SPAC, which is an IPO substitute vehicle that presents companies to the public markets in a faster period. SPACs are formed to raise capital to pick out another company to team up with over the two years and bring it public.

Donald Trump’s social media venture falls

Last year, there was a vast SPAC crash, with record exudation, though a lot of people have slammed this vehicle. Without the traditional IPO underwriting procedure, according to critics, inexperienced companies who have brittle basics are going public, putting investors at huge risks.

Last month, according to reports from Reuters, Josh Adams, and Billy Boozer, Truth Social’s chiefs of technology and product development, had taken an exit from the company.

In the meantime, earlier this week, hedge fund Kerrisdale Capital Management confirmed that it is shorting DWAC, stating in a tweet that it thinks the SPAC will not protect regulatory approval ever to crack its offered merger.

Investigations into DWAC

In December, the Securities and Exchange Commission and the Financial Industry Regulatory Authority, these two financial regulators started investigations into DWAC concerning the stock trading and communications with Trump’s company before the announcement of the merger.

Final Words

We will keep you updated with all the latest news until then stay tuned to our website.

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