Trump’s $ 300 million PSPC deal may have bypassed securities laws



Mr Trump was originally scheduled to announce his new social media company in August, according to a person briefed on the schedule. But plans were delayed after Mr. Trump’s son Donald Trump Jr. expressed reservations about the Digital World deal, according to people familiar with the negotiations.

On August 3, Mr. Orlando wrote to the SEC requesting permission to expedite Digital World’s IPO for that month, only to withdraw his request two days later. When the SPAC finally went public on September 8, raising $ 293 million, Digital World said it still had not identified a merger target.

Less than three weeks later, on September 27, Mr. Orlando traveled to Mar-a-Lago, Mr. Trump’s private club in Florida, to sign a “letter of intent” – a formal first step towards a merger of Digital World and Trump Media, according to a person with knowledge of the event. For a new PSPC, it was an extraordinarily rapid turnaround; most SPACs take at least a year to find and merge with a target.

On October 20, Mr. Orlando returned to Mar-a-Lago, where he and Mr. Trump signed the final papers under chandeliers in a cavernous, golden ballroom, according to an attendee. Donald Trump Jr. and former “apprentice” candidates Mr. Moss and Mr. Litinsky were among the attendees.

After the deal was announced last week, Digital World shares have soared. This week they fell. At least two of the flagship investors, DE Shaw and Saba Capital, sold a large chunk of their stock after the Trump deal was revealed. Another leading investor, Iceberg Research, announcement that he was betting against the stock.

Despite this, Digital World shares remain around seven times higher than before the Trump deal. On paper, at least, the company is worth over $ 2 billion.

As he boarded a plane on Tuesday, Mr. Orlando didn’t say much about how the deal came about. “It was wild,” he says.

Kenneth P. Vogel, Michael schwirtz and Shane Goldmacher contributed reports. Susan C. Beachy contributed to the research.


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