NEW YORK, Oct 12 (Reuters) – Digital World Acquisition Corp (DWAC), the blank-check acquisition company that plans to merge with former U.S. President Donald Trump’s social media firm, said on Thursday it would return to investors $533 million raised for a cash infusion in the deal, after some already backtracked on another $467 million of commitments.
The development is the nail in the coffin of the $1 billion investment that DWAC (DWAC.O) had raised for the merger with Trump Media & Technology Group (TMTG), which runs the Truth Social platform. It raises further doubts about whether the former U.S. president will go ahead with the deal, now that TMTG no longer stands to receive $1 billion if and when it closes.
The move leaves DWAC with the $293 million cash it had raised in its initial public offering in September 2021, which is set to go to TMTG upon the deal’s closing. That pot of money could also shrink if investors opt for redemptions. It was unclear how Trump Media & Technology Group (TMTG), will fund itself if the deal does not go through. TMTG previously raised $22.8 million in financing from private investors, Reuters reported last October.