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Digital World Acquisition Corp. shareholders vote to approve Truth Social merger

STEVE INSKEEP, HOST:

Donald Trump's Truth Social will now be traded on the Nasdaq, one of the big stock exchanges. Truth Social is merging with a little-known public company, and Trump now stands to make a lot of money from stock sales just as he really needs it. NPR's Rafael Nam is here. Good morning.

RAFAEL NAM, BYLINE: Good morning, Steve.

INSKEEP: OK, so this is not an initial public offering, where you throw the stock out and it gets bought for the first time ever. So what is it?

NAM: No, it is not. So it's not as straightforward as an IPO. What's happening here is that Truth Social is going to merge with a shell company. It was - and this shell company was specifically created to merge with Trump's company. On Wall Street, it's called a backdoor listing. It's a way to go public, but in a different way from a traditional IPO.

Now, shareholders of this company - and I'm going to try real hard not to trip on the name here - Digital World Acquisition Corporation - but let's call it DWAC...

INSKEEP: All right.

NAM: ...'Cause everybody else does - well, their shareholders approved that merger just this morning. So that's fantastic news for Trump. He would own over 50% of the new company, and that would be worth over $3 billion. That's three with a B.

INSKEEP: Three billion dollars for what exactly? It's not that successful a platform.

NAM: Well, that's the thing. But you know what he does have? He has millions and millions of rabid followers and many people who would be willing to buy into this stock. You got to keep one thing in mind about Truth Social. Truth Social is about all - it's all about President Trump. And as long as he has all these people willing to buy the shares, you would think that the stock would continue to go up.

Now, there are also professional investors like Matthew Tuttle. He runs his own investment firm. And I reached out to him yesterday to see why he's an investor in the company, and he was pretty upfront about it. He thinks he can make a quick buck.

MATTHEW TUTTLE: While fundamentally I don't get it, I'm going to trade it because it's going to move. It's going to have a rabid following, and it's going to be a fun stock.

NAM: But of course, like I was saying, nobody stands to gain more than President Trump.

INSKEEP: Well, it happens that he could use the money. He faces a deadline on Monday to come up with something more than $450 million in a court case. Could he quickly sell some shares and raise that cash?

NAM: This is where he could run into a problem. That's because under the merger, he has to hold on to his shares for another six months. But this is Donald Trump, so, I mean, who knows? He could work out a side deal with other shareholders because the bottom line is that he needs to, obviously, raise money immediately, like you just said. And - but he does have the clock ticking, too. This Monday, he has to come up with over $400 million to post bond in the state of New York's fraud case against him, his family and The Trump Organization. What's not clear is whether he'll be able to do that that quickly.

INSKEEP: OK. So this company, Digital World Acquisition Corp., is already a public company. It's already on the Nasdaq. I'm looking here. It looks like the share price today just went up a bit to a little over $40 a share, although it's still down overall for the day. What happens now? When does it start trading as Trump's company?

NAM: So it's going to start trading as a new company starting next week, but it is going to be a wild ride. That's what I'm being told. Already, you're seeing some of the shares of DWAC - it currently continues to exist as DWAC, as I was mentioning. And those shares were going to - are going to be very volatile all the way through the merger. And I should note that the new company will be called Trump Media & Technology Group with a new stock symbol, DJT - Donald J. Trump.

INSKEEP: Rafael Nam from NPR News - RN. Thanks so much. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

Steve Inskeep is a host of NPR's Morning Edition, as well as NPR's morning news podcast Up First.
Rafael Nam
Rafael Nam is NPR's senior business editor.