Trump Supporters Who Bought Shell Company Stock Face Millions in Losses Ahead of Liquidation Date
President Donald J. Trump dances at the conclusion of a rally in Greenwood, Neb. May 1, 2022
Matt Johnson/Right Cheer
Digital World Acquisition Corp (DWAC), the special purpose acquisition company attempting to merge with Donald Trump’s Twitter clone Truth Social announced Thursday that it had postponed a critical shareholder vote for the sixth time ahead of a mandatory liquidation date of Dec. 8.
In a call with investors, Patrick Orlando, the chairman and CEO of the struggling shell company announced that DWAC was going to reconvene on Nov. 22. It was an ominous sign that Digital World had failed to receive authorization from 65% of shareholders to continue the company’s existence, despite months of trying. Under the terms of DWAC’s incorporation, the company was supposed to merge with a private firm within one year’s time or dissolve and reimburse its investors at a rate of about $10 per share.
Liquidation appears more likely to be DWAC’s fate as Trump himself appears increasingly uninterested in the company (or its stockholders) as it has struggled to defend itself from a criminal investigation that executives engaged in prohibited insider trading and a separate inquiry from the Securities and Exchange Commission about allegations of illegal contact between DWAC officers and the leadership of Trump Media and Technology Group (TMTG).
The disgraced ex-president hasn’t said a word to his supporters to encourage those who own the stock to prolong DWAC’s existence. New documents released by William Wilkerson, a former TMTG executive, indicate that Trump has been exploring merging with other right-wing technology companies instead, including Rumble, a video hosting platform which recently completed a merger similar to the one that DWAC and TMTG have been attempting. Another potential target listed was Parler, another Twitter clone which the antisemitic rapper formerly known as Kanye West has talked publicly about purchasing in order to build more safe spaces for far-right discourse.
As DWAC has struggled to avoid dissolution, Orlando has tried in vain to enlist Trump to help. Should the company end up liquidating, it will mean massive losses for many of Trump’s most ardent supporters who purchased the stock at prices in excess of $90 per share.
In remarks posted on Truth Social after the latest postponement, members of the site expressed increasing frustration with DWAC’s leadership.
“We are all in the dark and have no idea what's going on after multiple extensions,” one member wrote.
“I agree this is BS!” another user replied. “I love Truth Social but I can honestly say that I’ve never seen anything like this in my life! Guess our stock is fixin to drop lower on the news!”
In October, Trump openly contemplated abandoning DWAC during a meandering speech to supporters at a Michigan campaign event:
“The company that wants to finance Truth Social … if they don’t come up with the financing, I’ll have it private,” he said. “Truth Social is hot, easy to have it private. You don’t have to go through all this.”
Since he left office, Trump has targeted his political supporters to finance his financial operations as Wall Street and traditional investors have soured on his serial bankruptcies and illegal attempts to stay in office after losing the 2020 presidential election.
According to SimilarWeb, a web traffic analytics company, Twitter received 6.8 billion visits in August. Truth Social received 9 million visits in August, down from 11.5 million in July. Truth Social’s traffic among American internet users is about the same as that of Parts Geek, an auto part website, SimilarWeb data indicates.
Benessere Capital, another special purpose company founded by Orlando, announced that it would liquidate itself on Oct. 21. Last November, Yunhong International Co., a Chinese-based SPAC also created by Orlando, dissolved itself after failing to complete a merger.
TYT National Correspondent Matthew Sheffield reports about politics, media, and technology. Follow him on Twitter: @mattsheffield.