In yet another troubling development for Donald Trump’s Truth Social media platform, stock values have taken a dive for the special purpose acquisition company (SPAC) that Truth Social is supposed to merge with to go public.
CNBC reports that prices have fallen 16% this month, including an 8% dip Monday, after investors apparently got jittery about a delay in the planned merger of the SPAC — Digital World Acquisition Corp. — with Truth Social’s owner, Trump Media & Technology Group.
Stocks were trading at $25.32 a share Monday, down significantly from their 2022 peak of about $97, according to CNBC.
A Monday filing from Digital World said voting for a yearlong delay in the merger would open Tuesday. The current deadline to take Trump Media public is Sept. 8, but Digital World has warned that it could be forced to liquidate if the deadline is not extended. The company noted in an earlier filing with the Securities and Exchange Commission that it lost $6.5 million in the first half of the year.
The latest development follows news that Truth Social is grappling with other money and trademark issues as Trump deals with various personal legal problems.
RightForge, a major web-hosting operator, claimed last week that Truth Social owes some $1.6 million in contractually obligated payments, reported Fox Business.
In another setback this month, Truth Social’s application for a trademark was turned down. The U.S. Patent and Trademark Office found that Trump’s company name was “confusingly similar” to other entities.
Digital World, already being investigated by the SEC over business dealings, also delayed its earning report earlier this month and warned in a filing last week that a dip in Trump’s popularity could hurt the business.
The Washington Post has reported that Truth Social’s U.S. audience has plunged to about 300,000 views a day, down from nearly 1.5 million when it launched.
The site is largely a platform for Trump, with heavy censorship, researchers and critics have found. Detractors say users are better served on competing right-wing social media sites like Telegram, Parler and Gab where there is a greater sense of a developed community with more discussion.
Trump has posted a number of messages on Truth Social calling all negative information about his company in the media “fake news.” He has also posted messages asking people to join the site.