SPAC less associated with the edge of Trump’s social media initiative as short seller target by Reuters

Reuters. File photo: Former United States President Donald Trump addresses a rally on October 9, 2021, at the Des Moines, Iowa States Fairgrounds in the United States. REUTERS / Rachel Mummey

(Reuters) – Shares of a blank-check acquisition firm that plans to publicly list former US President Donald Trump’s new social media venture fell on Monday after a tearful rally last week, as a short-seller said it was betting against the company. .

Digital World Acquisitions, the Miami-based special purpose acquisition agency (SPAC), fell 10.98%, announcing on Wednesday that it would merge with Trump’s media company in the first fall session to create a social media app called TRUTH Social.

The stock has risen since the announcement and has been above 700% since the deal was unveiled.

Earlier on Monday, short seller Iceberg Research tweeted that it was betting against the company’s shares.

“We are small $ DWAC. Now that the initial tensions have subsided, we see only risk for investors in the near future. Based on Trump’s track record, at current prices, the review is likely to have more of a consolidated company for him, “Iceberg Research tweeted.

Iceberg, which publishes a blog with its research on WordPress, drew attention in 2015 to highlight the aggressive accounting practices of the Nobel Group, a Hong Kong-based product trader. Noble denied the allegations but later saw his profits plummet and was forced to sell most of his assets.

The company said earlier this year that it was short-lived meme stock AMC Entertainment (NYSE 🙂 Holdings.

The recent rise of digital world acquisitions is reminiscent of the meme stock frenzy of early 2021, when a force of retail investors on Reddit encouraged hyper-rallies. Gamestop Corporation (NYSE :), AMC Entertainment Holdings and other stocks.

Twitter (NYSE :), Facebook (NASDAQ 🙂 and other social media platforms banned Trump from their services after hundreds of his supporters rioted in the US Capitol on January 6.

TRUTH Social is set for a beta launch next month and a full rollout in the first quarter of 2022.

SPACs allow private companies to list their shares publicly, bypassing traditional initial public offers.

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