Digital World Acquisition, the SPAC planning to take Donald Trump’s media company public, disclosed in an 8-K filing that PIPE investors on the deal have terminated $138.5 million. Investors in the PIPE are free to walk away from the deal after the SPAC failed to close the merger with Trump Media & Technology Group by the Sept. 20 deadline.
Reuters reported that Sabby Management investors bowed out, taking $100 million with them.
Digital World had PIPE commitments for up to $1 billion.
CNBC reported that the SPAC had changed its address to a Miami UPS store. That could be a sign Digital World is trying to save cash as it struggles to get the Trump deal done.
A stockholders meeting has been postponed to Oct. 10 for a vote on whether to extend the SPAC’s merger deadline until Sept. 23. Digital World for now is operating on an automatic three-month extension, which is good until December. CEO Patrick Orlando contributed $2.8 million from his company Arc Global Investments II to the SPAC’s truast to trigger the automatic extension.
Both the SPAC and Trump’s company are under federal investigation, with regulators focusing on whether the parties held merger discussions before the SPAC went public. Investigators are also said to be looking at unusual trading activity in the SPAC’s warrants just before deal announcement. Read more.
