In a compelling turn of events, a blank-check firm that was on the verge of merging with former U.S. President Donald Trump’s media company, and currently under regulatory scrutiny, has reached a preliminary agreement with the Securities and Exchange Commission (SEC). This agreement, however, is still pending the SEC’s official approval and is not yet set in stone.
Digital World Acquisition Corp, the special purpose acquisition company (SPAC) involved in the potential merger, made this disclosure in a recent filing. It is worth noting that in October 2021, Trump’s media venture, Trump Media & Technology Group (TMTG), had announced its plans to go public by merging with DWAC. Nevertheless, the future of this SPAC deal became uncertain following investigations by the Justice Department and the SEC.
Should the settlement be approved by the SEC, it would result in a cease-and-desist order against DWAC, citing violations of specific antifraud regulations in relation to the proposed merger. It is important to mention that Trump’s media group had previously agreed to combine forces with Digital World Acquisition Corp, with the aim of bringing the company into the public domain through a SPAC transaction.
DWAC emphasizes the significance of obtaining SEC approval for the settlement, as failure to do so could potentially lead to prolonged legal battles. Such disputes could greatly hinder the company’s ability to merge not only with TMTG but also with any other potential target. It should be noted that while Trump’s media firm is not directly involved in the settlement or any negotiations, DWAC cannot reach a settlement without obtaining the company’s written consent.
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