Digital World Acquisition Corp. said Friday it has updated its filing with the Securities and Exchange Commission regarding its planned merger with Trump Media and Technology Group, former President Donald Trump’s social-media company, to reflect new risk factors.
The update comes after the recent New York civil fraud ruling against Trump, which included an order to pay $364 million in penalties and a ban on any role in running a business in New York state for three years.
Trump “is the subject of numerous legal proceedings, the scope and scale of which are unprecedented for a former President of the United States and current candidate for that office,” said the update.
DWAC said it cannot guarantee that opponents of Trump may make moves aimed at preventing the deal from closing.
“We cannot assure you that the claims asserted against TMTG or Digital World are without the financial and/or human capital resources of operatives representing the interests of political opponents of President Trump focused on thwarting the business combination to prevent President Trump’s potential financial gain, which focus could further delay, or prevent, the completion of the business combination,” DWAC said in the update.
The update also cautioned that the deal could be delayed by Trump Media’s co-founders, Andy Litinsky and Wes Moss, whose investment company, United Atlantic Ventures, has threatened to block the deal.
UAV recently sent letters to DWAC asserting that an early agreement with Trump from 2021 is still in effect and gives them the right to appoint two directors to the board.
“As previously disclosed, assertions made by UAV, and the potential claims arising therefrom, could lead to substantial legal costs, distract management, and have adverse effects on the business operations and financial health of TMTG and/or the combined entity,” said the update.
The update comes a week after DWAC disclosed that the SEC had declared the registration statement for the proposed merger to be effective. The company said it would shortly announce a date for shareholders to vote on the merger.
DWAC, which is a special purpose acquisition corporation, or SPAC, launched merger talks with TMTG, which operates the conservative Truth Social platform, in October of 2021, but has struggled to consummate the deal amid regulatory pushback and challenges from the Justice Department.
Also read: Trump’s Truth Social merger partner settles fraud charges with SEC over misleading investors
DWAC’s stock
DWAC,
however, has been flying high despite all the uncertainty, and has gained 216% in the last 12 months, while the S&P 500
SPX
has gained 26.8%.
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