“DWAC”, Digital World Acquisition Corp, is the Spac which will serve as a support for the social network on the Nasdaq.
The company that should allow Donald Trump’s social network to go public is experiencing a meteoric rise on Wall Street. A success that illustrates as much the speculative fever around media headlines as the popularity of the former US president with his electoral base.
After being suspended multiple times on Friday morning, Digital World Acquisition Corp’s stock soared and ended up 107.03% to $ 94.20. Its price had taken off about 200% earlier today after having already climbed more than 350% on Thursday at the close. Based on the most recent figures, the group’s stock market value reached $ 3.2 billion. An impressive amount for a recent company, until then confidential and without commercial activity.
Digital World Acquisition Corp, which trades under the symbol DWAC on the Nasdaq, is indeed a special purpose acquisition company, or SPAC in English, that is to say an empty shell listed on the stock exchange with a view to a merger with a company for which it raises funds by selling shares. When it joined the Nasdaq in September, DWAC had raised $ 293 million.
The target company therefore turned out to be Donald Trump’s new media and technology group, founded in February in Delaware, which is to carry the Republican billionaire’s social network project. Entitled “Social Truth”, this future platform was presented by the former tenant of the White House as an alternative to Facebook, Twitter and YouTube from which he is banned for having incited his supporters to violence before the invasion of the Capitol, the January 6. In a statement released Wednesday to announce the merger with DWAC, Donald Trump said he wanted “resist the tyranny of technological giants“And was indignant at having been”silenced“.
To see also – “Truth Social”: discover the visuals of Donald Trump’s future social network
Its recent surge on Wall Street is reminiscent of that of video game chain GameStop and a handful of other titles (AMC, Blackberry, Bed Bath & Beyond) earlier this year. These companies had been acclaimed by an army of amateur investors wishing to take back large funds who had instead bet on the stock market collapse of companies in faltering financial health. For Patrick O’Hare, head of market analysis at Briefing.com, the parallel with the GameStop saga is obvious, especially as speculation around PSPC has been rife for several months in the United States. “These are gambling», Affirms Patrick O’Hare. “It is a sign of the times. There is no fundamental reason to justify the movements that we observe.“
On Reddit’s WallStreetBets forum, home to 11 million super-risky stock market bettors who had been at the forefront of GameStop’s rise, DWAC’s rise was widely discussed. “It turns out that DWAC was the new GME (the symbol of Gamestop, editor’s note)One of the forum members was enthusiastic on Friday.
Another possible reason for DWAC’s stock market growth is the support Donald Trump continues to enjoy among millions of Republican voters. Defeated by Joe Biden in the presidential election last November, the billionaire has never officially recognized his defeat and has hinted that he intends to run again in 2024.
The announcement of the merger between DWAC and Donald Trump’s new group, however, was not to the liking of all investors. According to the New York Times, the Saba Capital fund, headed by an investor with a democratic tendency, thus decided to sell a large part of its shares in the company when it learned of its links with the former tenant of the White House. Contacted by AFP, Saba did not react immediately.