Donald Trump’s new social media venture says Republican congressman Devin Nunes from California will leave Congress to become the company’s chief executive in January.
Earlier Monday, the company that aims to take Trump Media & Technology Group public acknowledged that two regulatory agencies are scrutinizing the deal.
Digital World Acquisition, which is often referred to by its trading symbol of “DWAC,” said it is cooperating with “the preliminary, fact-finding inquiries” by the Securities and Exchange Commission and the Financial Industry Regulatory Authority.
Regulators are looking into the deal that would bring Donald Trump's new social media company to the stock market, one that has attracted both legions of fans of the former president and people looking to make a quick profit.
The company acknowledged the inquiries in a filing it made with regulators on Monday. It also gave some financial forecasts for the company, which wants to rival Twitter, Netflix and other streaming video services. It said over the weekend that it's lined up $1 billion in investments from a group of unnamed institutional investors.
Just what the regulators are probing is not clear. What’s more, the regulatory rules on SPAC discussions with targets are gray, prohibiting only “substantive” talks with possible acquisition targets.
An SEC spokesperson declined to comment beyond saying, “The SEC does not comment on the existence or nonexistence of a possible investigation.”
The merger announcement sent DWAC's stock surging from $9.96 to $94.20 in just two days. The shares have since pulled back to roughly $44.
Such a lofty price indicates high expectations for Trump's media venture among at least some investors. In its filing with regulators, DWAC also gave some financial forecasts for the company, which has yet to launch but wants to build a “non-cancellable” global community.
The presentation included forecasts that the company's TRUTH Social service may have 81 million users by 2026, or nearly 7 million more people than voted for Trump in the last U.S. presidential election.
AP Photo/Ross D. Franklin, File
