That valuation is half that of Elon Musk's much more famous social media company X.
Truth social network logo. Photo: REUTERS
The value the stock market has assigned to the deal has more than tripled since January, when Mr. Trump steadily gained the Republican presidential nomination. The former U.S. president will own between 58.1% and 69.4% of the combined company, depending on how much investors back the deal.
Trump could divest his stake in Truth Social and end any involvement in its management based on the outcome of the U.S. presidential election, Digital World Acquisition Corp (DWAC) - the company merging with Trump's company, said in a regulatory filing on Wednesday.
A filing revealing new information about the business operations of Trump Media & Technology, the parent company of Truth Social, has been given the green light by the SEC, allowing Digital World to vote for shareholders to support and complete the merger.
Since DWAC signed a merger agreement with Truth Social in October 2021, the company has been the target of an investigation by the US Department of Justice .
Digital World shares rose 16% to $50.49 in afternoon trading in New York on Thursday. At that share price, and assuming no Digital World shareholders exercise their options to redeem their shares, the combined company would be worth about $10 billion, with Trump owning a 58.1% stake worth about $4 billion.
Truth Social reported total revenue of $3.4 million in the first nine months of 2023, up from $237,000 a year earlier, according to DWAC filings. Its operating loss was $10.6 million, down from $19.3 million a year earlier.
Truth Social was launched to connect Trump with his followers after he was "kicked out" of major social media platforms following the attack on the Capitol by his supporters on January 6, 2021.
Mr. Trump has 6.61 million followers on Truth Social, compared to the more than 88 million followers he had on X when the social network suspended his account and still has 87.4 million followers after it was reopened.
Truth Social has 8.9 million signups to date, DWAC said. By comparison, X has more than half a billion monthly users.
Mai Anh (according to Reuters)
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