Yes, the company went public. No, it is not a financial success—or even a lifeboat.
Debuting on the charts w/a “DJT” ticker, #TrumpMedia saw a 55% surge in valuation right after markets opened.
Huge influx of cash, right? w/Trump holding ~79M shares, equating to 58% of available stock, the #SPAC debut balloons his #NetWorth by nearly $5B; there were ~136M shares outstanding post-merger.
What a turnaround, right after the lamestream media kept claiming #Trump was in the tank! Another genius business move from the Donald, right in time for him to cover his somewhat discounted #legal bills!
Except … not really, bc a lot of what powered the 1st-day boom is not tenable in the longer term—much like TruthSocial’s business itself.
To put it simply: The success of #TrumpMedia’s #IPO has less to do w/its viability as an enterprise & more to do w/the fandom surrounding that famous name.
Before going public, the co was far from profitable: TruthSocial itself only garnered $3.38M in total revenue over the 1st 3 quarters of 2023—& lost $49M over that same period, w/ >½ of that loss occurring in Q3. Per Axios:“The company’s cash-on-hand dwindled to just $1.8M at the end of Sept…while its total liabilities climbed ~72% to $60.5M.” (#DWAC pre-merger fed filings noted “mgmt has substantial doubt that [#TrumpMedia] will have sufficient funds to meet its liabilities as they fall due.”)
…those pitiful earnings represent a steep drop from the hundreds of millions that #DWAC had raised from investors, some of whom yanked out their commitments before the merger. Bloomberg reported Mon that some initial DWAC #investors were so bearish that they redeemed their shares before the merger was approved, taking a 75% loss on those #investments. In other words: The company is a #financial mess.
…fresh from a merger w/a cash-rich #ShellCompany… Trump’s #socialmedia co jumped on its 1st day of trading on the #Nasdaq Tues, giving the co an estimated market value of ~$8B…
The biggest beneficiary…has been #Trump, who owns about 60% of #TrumpMedia, making him the largest shareholder. His stake in the co — the parent of TruthSocial, the online platform that is Trump’s main megaphone… — is worth ~$4.6B on paper.
¿ Trump’s Net Worth Hits $6.5B, Making Him One of Bloomberg’s World’s 500 Richest People¿ [several caveats to this]
#Trump’s business empire was supposed to be in peril like never before on Mon. Instead, it turned into the single-greatest day on record for his wealth.
Facing a deadline to post a #bond of >$500M in a #NY#fraud#lawsuit, a state appeals court tossed him a lifeline, slashing it to $175M — an amt he says he’ll cover. Around the same time, his #socialmedia co #TrumpMedia & Tech Group wrapped up a 29-month-long merger process, meaning shares worth billions on paper are now officially #Trump’s.
#TrumpMedia merger wins investor approval, netting #Trumppotential windfall
TFG will own ~60% of #TruthSocial, which at its current share price would be worth ~$3.3B.
A lockup agreement will prevent him from selling the shares for 6 months.
A long-delayed move that will open the owners of TruthSocial to stock-market investors & grant Trump a stake worth billions he could use to pay down his #legal#debts.
The vote Fri by investors in #DWA authorized the #SPAC, to merge w/ #TrumpMedia & #Tech Grp as part of a process that will avoid a more traditional #IPO. #Trump will own ~60%, which at DWA’s current share price would be worth ~$3.3B. He & other investors could earn tens of millions more shares through an “earnout” provision tied to the stock’s performance, DWA said in an #SEC filing.
The merger will net TrumpMedia $300M that DWA initially raised from investors.
#Trump’s allies & company execs will also be granted bundles of shares in the new company that could be worth millions. But trading on the #stockmarket will also open the company to more public scrutiny, & any drops in share prices would affect the value of those stakes.
Critics have said #TrumpMedia is a “#MemeStock” w/a >$6B valuation they say is out of sync w/its financial outlook. TrumpMedia lost $49M in the first 9 months of last yr & brought in just $3.4M in revenue, per #DWA#SEC filing.
#TrumpMedia, launched after an #insurrection, faces rebellion
4 suits involving the founding boosters of #TruthSocial threaten #Trump’s grasp on a massive financial haul
When #TMTG & its proposed merger ptr, #DWA, announced last month a shareholder vote on their long-delayed deal, it marked a final step for the owner of TS to become a public co potentially worth billions —most of which is owned [how much he can sell is limited] by Trump.