Trump Media & Technology Group

On October 20, 2021, TMTG and Digital World Acquisition Corp. (DWAC), a publicly-traded SPAC, announced that they had entered into a definitive merger agreement that would combine the two entities, allowing TMTG to become a publicly-traded company. DWAC was created with the help of ARC Capital, a Shanghai-based firm specializing in listing Chinese companies on American stock markets.[6][7]

The company's announced future product offerings include a social network (Truth Social) and on-demand programming (TMTG+).[8] The group plans to offer alternative media to challenge the traditional social networks like Facebook, YouTube and Twitter and may attract mainly conservative online viewpoints to its own network. The established social networking companies had earlier shut down President Trump's public pages from their platforms.

SPACs are structured such that they first sell shares to the public and then raise funds from investors to later acquire a private company, the identity of which cannot be known by the SPAC or its investors in advance. Some investors were surprised to learn that their investment money was being used to finance a Trump company. SPACs have long had questionable reputations because they can give companies access to public markets that would otherwise be difficult, due to a poor or nonexistent track record.[9]

The New York Times reported days after the TMTG deal was announced that the founder of the Digital World Acquisition Corp. SPAC, Miami banker Patrick Orlando, had been discussing the deal with Trump by March. The formation of the SPAC was announced in May and it was taken public in September. The Times reported that by summer 2021 people affiliated with TMTG were telling Wall Street investors that the company was nearing a deal to merge with a SPAC. DWAC was not specifically named, but if it was the SPAC in question this may have skirted securities laws and stock exchange rules, since SPACs are not allowed to have a target company in mind prior to going public. Trump and Orlando had initially discussed a deal through another of Orlando's SPACs that was already publicly-traded, but it was deemed too small for the Trump deal. Some bankers told the Times that because the deal discussions began when the first SPAC was being considered, which would be proper, an argument could be made that discussions did not occur after the SPAC was formed, which would be improper. DWAC stated in three prospectuses that it had not had "any substantive discussions, directly or indirectly, with any business combination target."[10]

In December 2021, TMTG said it had raised $1 billion in private investment in public equity (PIPE) funding. The investors are unidentified. The Financial Times reported the expected proceeds of the PIPE and SPAC funding to TMTG would be $1.25 billion.[11]

DWAC disclosed in a December 2021 regulatory filing that the Securities and Exchange Commission and the Financial Industry Regulatory Authority had weeks earlier asked it for information about stock trading and communications with TMTG prior to their deal being announced.[12][13]

On December 14, 2021, TMTG announced that it had entered into a "wide-ranging technology and cloud services agreement” with Rumble, and that Rumble would operate part of the TRUTH Social network as well as TMTG+. [14][15]