DWAC surges 35% on court's decision to cut Trump's bond fine; new ticker revealed

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DWAC surges 35% on court's decision to cut Trump's bond fine; new ticker revealed

Digital World Acquisition Corp. (DWAC) saw its shares surge by 35% on Monday, following an appeals court decision to significantly lower the bond required from former President Donald Trump in a civil fraud case, to $175 million from the initial $454 million.

Moreover, the court extended the deadline for Trump to post the bond by 10 days. This financial relief comes as DWAC prepares to begin trading under the new ticker symbol DJT on Tuesday after the company completed the merger with the former US president’s social media company, Trump Media & Technology Group.

DWAC shares rose by an additional 7.5% in premarket trading Tuesday.

Yesterday’s rally was largely attributed to the reduction in Trump's bond amount. Investors had been concerned that Trump might need to sell a portion of his majority stake in the company to raise the necessary funds if the bond had remained over $400 million. However, with the bond set at $175 million, the likelihood of Trump selling his shares or pushing for changes to the merger's terms has decreased notably.

The merger between DWAC, a special purpose acquisition company (SPAC), and Trump Media & Technology Group, which owns the social media platform Truth Social, received shareholder approval on Friday.

The public trading of the merged entity under DJT is poised to potentially benefit Trump financially, with an expected ownership of 80 million shares, potentially valued at $3 billion or more.

The terms of the merger stipulate that Trump cannot sell his shares for at least six months, although the board, expected to include allies such as Donald Trump Jr. and Robert Lighthizer, may permit him to sell stock earlier.

The ability to sell shares could provide Trump with significant resources to address his legal expenses and over $500 million in judgments from three separate cases.

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