The blank check company that will merge with Donald Trump’s social media startup has warned shareholders that its plan to “cancel ‘cancel culture'” carries risks due to the company’s history of bankruptcies. enterprises of the former president.
“A number of businesses associated with President Trump have filed for bankruptcy,” the company said in a registration statement. “There can be no assurance that TMTG will not also go bankrupt.”
TMTG also listed the fate of some of its owner’s previous business ventures. Trump Plaza, Trump Castle and The Plaza Hotel have filed for bankruptcy protection. Trump University, Trump Vodka, Trump Mortgage and Trump Steaks all folded after operating for periods ranging from months to years.
Depending on how many investors decide to complete the deal, Trump would control between 47% and 57% of Trump Media & Technology Group after its merger with Digital World Acquisition Corporation, according to the statement filed Monday with the Securities and Exchange Commission. .
Users of the company’s flagship service, Truth Social, will have access to the former president’s social media posts at least six hours before they appear on other platforms, according to the filing. The exclusivity deal, which is part of a sweeping agreement governing the new company’s relationship with Trump, does not apply to political messaging or “get out the vote” efforts.
Trump had nearly 90 million Twitter followers before the platform banned him in January 2021 “due to the risk of further incitement to violence.” The move came after thousands of supporters, some carrying Trump flags, stormed the US Capitol building in what prosecutors said was a seditious plot to block certification of Joe Biden’s election victory.
TMTG has revealed that it has no right to back out of its deal with Trump, “even if [his] conduct could negatively impact TMTG’s reputation or brand or be considered offensive, dishonest, illegal, immoral or unethical”. But he has every right to beat any offer a rival streaming video platform might make to the politician and former reality TV star.
Billionaire Elon Musk, who agreed to buy Twitter for $44 billion, said last week he would reverse Trump’s ban, calling it a “morally wrong decision”. One of the risks for TMTG was that “under new ownership, Twitter may demonstrate a renewed commitment to free speech principles that will intensify competition for users who prioritize those principles,” the statement said. ‘registration.
Truth Social launched in February, marking the first step in the company’s plan to enter the crowded landscape of social media and video streaming with a new concept designed to “stand up to ‘cancel culture’.” and “self-righteous rebukes”.
The plan has already proven highly lucrative for the team behind Digital World, who paid $25,000 for a special class of “founder’s shares” in the company. The shares had a market value of $357 million at the end of March, according to the filing.
But for ordinary investors, the company’s outlook is uncertain.
“If TMTG fails to promote and maintain TMTG’s programming as ‘unawakened’ programming and one that cancels ‘cancel culture’ . . . its business and results of operations could be adversely affected,” indicates the folder.