String Of Resignations May Threaten Plans To Take Trump's Truth Social Public: Report
Designs for Donald Trump’s Truth Social operation to go public appear to be at risk yet again, Forbes reported Friday.
Three executives suddenly left the company charged with taking the former president’s Truth Social platform public amid investigations and market upheaval, according to Forbes. It was not immediately clear why they left.
The top-level departures, which included the chief financial officer, were revealed in filings of the Digital World Acquisition Corp., the special-purpose acquisition company (SPAC) picked to move the social media platform into the big leagues.
The “slew of resignations” follows the departure of yet another board member who resigned in early November, Forbes reported. That was shortly before shareholders agreed to back a move to extend an early December deadline to complete the acquisition of Truth Social. It pushed the deadline to September 2023, which will be almost two years after the SPAC initially announced its deal to acquire Truth Social and take it public.
Digital World share prices slumped 10% Thursday after the former president promised a “major announcement” this week that turned out to be the sale of a Donald Trump digital trading card collection. Digital World investors were likely hoping for something to boost his status as a 2024 presidential candidate — and the standing of the company — or some good news about Truth Social
Trump’s operation has been wracked with problems and hit with investigations.
A major web-hosting operator claimed in August that Truth Social owed some $1.6 million in contractually obligated payments.
Then Truth Social’s application for a trademark was turned down after the U.S. Patent and Trademark Office found that Trump’s company name was “confusingly similar” to the names of other entities.
In addition, the SPAC has been under investigation by the Securities and Exchange Commission for possibly negotiating the merger deal before DWAC went public, which would violate the law.
Digital World also warned in a Securities and Exchange Commission filing in August that a dip in Trump’s popularity could hurt the business. The filing noted that Truth Social’s success hinges on the “reputation and popularity” of Trump, who chairs the Trump Media and Technology Group, which owns and operates the social media platform.
Digital World shares fell an additional 4% in pre-market trading Friday to about $19.20, Forbes reported. The stock has lost more than 80% of its value since a high of more than $100 in March.