The social media app will be developed by the Trump Media and Technology Group (TMTG).
Rafael Enrique | Light Rocket | Getty Images
shares Digital World Acquisition Company — the shell company seeking to take former President Donald Trump’s social media platform public — shares soared more than 50% on Friday after the company announced it had gone public Fraud Allegations Resolved $18 million paid to the SEC.
The surge has lifted DWAC shares to about $20, still a long way from last March’s high above $95.
DWAC, a special purpose acquisition company (SPAC), announced plans to merge with Truth Social parent Trump Media & Technology Group in October 2021. The merger has since faced multiple delays.
DWAC’s SEC settlement agreement requires the company to pay an $18 million civil penalty if it merges with TMTG and takes the company public. But if the merger doesn’t happen by the Jan. 1, 2025 deadline, and DWAC returns investors’ money, the SEC agreed to waive the penalty.
The SEC alleges that inappropriate merger discussions occurred. It is illegal for SPACS to solicit specific merger targets ahead of the actual IPO filing.
The settlement comes after the US government charged three Florida men with insider trading related to DWAC.
The company’s shares had previously soared on news about former presidents, such as after Trump announced his 2024 presidential candidacy and was indicted.
But the DWAC settlement is just the latest in a growing string of legal issues that have dogged Trump and his businesses since he left the White House in 2021.
He is currently facing state charges in New York alleging that his company falsified business records. He was also indicted in federal court last month for allegedly mishandling classified documents. Trump has pleaded not guilty in both cases.
Authorities in Georgia are also investigating Trump, the frontrunner for the 2024 Republican nomination, trying to reverse his 2020 presidential defeat.
DWAC and Trump’s team did not immediately respond to requests for comment.