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Hedge Funds Make Millions as SPAC Shares Soar Post Trump Deal

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Hedge funds made millions in potential gains as the shares of a special purpose acquisition company (Spac) that merged with Donald Trump’s new social media soared to 421 percent yesterday, the Financial Times reported.

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Hedge Funds Make Millions as SPAC Shares Soar Post Trump Deal

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Called Digital World Acquisition Corporation, Spac’s shares rose from $9.96 to $51.90, closing at $45.50 – a 357 percent increase compared to the previous day.

The group of 11 hedge funds – including DE Shaw and Saba Capital – bought Digital World in September and owns almost all of its $293m IPO. After the deal with Trump, Spac’s 25 million units listed were worth collectively more than $1bn.

According to the paper, Digital World granted 150,000 sponsor shares to each hedge fund at $0.0029 per share.

The firms will not able to sell these shares until the deal with Trump Media & Technology Group, the parent company that owns the former President’s social media, is closed. The deal values Trump Media & Technology Group at $875m.

Trump made the headlines yesterday when he announced the launch of his social media app, TRUTH Social to “create a rival to the liberal media consortium and fight back against the ‘Big Tech’ companies of Silicon Valley.”

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Banned from both Facebook and Twitter, Trump said in the release that “we live in a world where the Taliban has a huge presence on Twitter, yet your favorite American President has been silenced. This is unacceptable.”

The post Hedge funds make millions as Spac shares soar post-Trump deal appeared first on CityAM.

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Article Source: NewsEdge

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