Editor’s note- This article was updated at 10:40 PM (EST).
On Monday, the stock of Trump-linked Digital World Acquisition Corp (NASDAQ:DWAC), the special-purpose acquisition company (SPAC) poised to take TMTG public, hits a 7-week low.
What Happened: The shares of DWAC plummeted by as much as 8.74% to $35.58 on Monday, the lowest level since Jan. 30. This comes as Trump’s attempts to secure a bond to cover a $454 million judgment in a New York civil fraud case were rejected by 30 surety companies, bringing him closer to the potential seizure of his properties, Reuters reported.
Trump’s legal team proposed that he be allowed to post a $100 million bond while he appeals the judgment. Earlier this month, Trump posted a $91.6 million bond to cover a defamation verdict for E. Jean Carroll as he appeals a case stemming from her accusation of rape against him.
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Despite the drop in stock value, DWAC has more than doubled in value year-to-date. The stock surged by 16% to $50.56 on Feb. 15 after the U.S. Securities and Exchange Commission (SEC) cleared the SPAC to merge with Trump’s Truth Social in a deal worth up to $10 billion.
Why It Matters: Trump’s legal troubles have been a source of concern for investors. The rejection of his bond request in the New York civil fraud case, where he was accused of inflating the value of his assets to mislead lenders and insurers, could have serious implications for his financial situation, including the potential seizure of his properties.
Trump’s legal and financial challenges have also raised questions about the potential sources of his debt settlement funds, with his ex-lawyer expressing concerns about the possibility of foreign funding.
Despite these challenges, Trump has been making moves in the tech and social media space, including pitching his social media platform to Elon Musk and changing his stance on TikTok. However, his legal battles and financial situation continue to cast a shadow over his business ventures.
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Image Via Shutterstock
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