Shares of Digital World Acquisition, the blank-check firm expected to take Donald Trump’s social media company public through a reverse merger, plunged more than 20 percent to below $20 today (Sept. 6) after Reuters reported the company failed to get shareholder support for an extension to complete the deal.
Digital World Acquisition announced an agreement in October to merge with Trump Media & Technology Group (TMTG), the parent company of Truth Social, a new social media site launched by Trump. The announcement pushed Digital World’s stock to $175 at one point as retail investors bought into the hype.
The merger agreement gave Digital World one year to complete the deal, with an option to extend the timeline for up to six months. As the one-year deadline approaches next month, Digital World still hasn’t secured shareholder support for the six-month extension, putting its merger with TMTG at risk. If the deal falls through, Digital World could be asked to return millions of dollars it raised to investors.