MIAMI - Digital World Acquisition Corp. (NASDAQ:DWAC) announced that its planned merger with Trump Media & Technology Group Corp. (TMTG) will continue as scheduled, with the Delaware Court of Chancery deciding not to block the upcoming stockholder vote set for March 22, 2024. The merger, if approved, will result in TMTG becoming a wholly owned subsidiary of Digital World, which will subsequently change its name to Trump Media & Technology Group Corp.
The court's decision came after United Atlantic Ventures, LLC (UAV) filed a complaint against TMTG seeking declaratory and injunctive relief concerning the authorization, issuance, and ownership of TMTG stock. TMTG has agreed to place any additional shares issued before or upon the merger's completion into escrow, pending the resolution of the dispute.
This stipulation was acknowledged by Vice Chancellor Sam Glasscock, who emphasized that the court would address any remaining issues promptly after the stockholder vote.
The parties involved have been directed to submit a proposed stipulated escrow order by the end of business on Wednesday, March 13, 2024. Digital World has committed to providing ongoing updates about the legal proceedings as necessary.
This merger is significant for Digital World, a special purpose acquisition company, which aims to carry out a business combination with TMTG, known for operating Truth Social.
The information in this article is based on a press release statement.
InvestingPro Insights
As Digital World Acquisition Corp. (NASDAQ:DWAC) navigates through its merger process with Trump Media & Technology Group Corp. (TMTG), investors are keeping a close eye on the company's financial performance and stock behavior. According to InvestingPro data, DWAC has a market capitalization of approximately $1.49 billion, highlighting the significant size of this SPAC as it moves towards its goal of acquiring TMTG.
InvestingPro Tips suggest that DWAC's stock has experienced substantial volatility, which could be a factor for investors to consider. Over the last week alone, the stock has seen a price total return of -12.92%, and over the last month, the return has been -14.99%. Despite these short-term declines, the company has shown strong returns over longer periods, with a 130.43% return over the last three months and an impressive 191.19% return over the last year.
Financial metrics also reflect some challenges, with an adjusted P/E ratio for the last twelve months as of Q3 2023 standing at -213.94, indicating that the company is not currently profitable. This is further underlined by an operating income of approximately -$13.52 million for the same period. However, the strong price performance over recent months suggests investor confidence or speculative interest in the company's future prospects following the merger.
For those considering an investment in DWAC, it's important to note that the company does not pay dividends, which could influence the decision-making of income-focused investors. With the next earnings date approaching on April 12, 2024, stakeholders will be looking for signs of progress towards profitability and stability post-merger.
For a deeper dive into DWAC's financials and stock performance, including additional InvestingPro Tips, visit InvestingPro. There are 12 more tips available on InvestingPro, providing further insights into DWAC's market position and potential investment risks. Use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, which could be an invaluable tool for those closely monitoring this merger and DWAC's future trajectory.
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