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Donald Trump’s Truth Social platform has started trading on Wall Street at a price of about $66.
Within minutes of trading, the new stock going under the name DJT, was fluctuating at around $70.
Shareholders of Mr Trump’s Truth Social platform voted on Friday to take the company public, a move that could raise the former president’s net worth by tens of millions of dollars as he desperately tries to find cash for the court-ordered judgments against him.
Mr Trump will need to find money from his own coffers or get help from a surety company to post an appeals bond by Monday that would block enforcement of a $454m penalty after a New York judge found that he defrauded banks and insurers.
His attorneys are asking a state appeals court to pause the judgment against him while he appeals without having to fork over tens of millions of dollars, which they called a “practical impossibility,” with rejections from roughly 30 bond companies who won’t take his prized real estate empire as collateral.
Political action committees supporting the Republican Party’s likely nominee to face President Joe Biden in November are also haemorrhaging tens of millions of dollars to pay his legal bills and attorneys’ fees, months before a summer of criminal proceedings and the general election.
The public debut of Truth Social’s parent company Trump Media & Technology Group could be a massive boost to the former president’s financial state – he could rake in more than $3bn from his investment.
But he won’t see any immediate return.
On Friday, after delays from investigations from regulators and the US Department of Justice, Truth Social shareholders approved a long-anticipated merger between Trump Media and the publicly traded shell company Digital World Acquisition Corporation.
Under the terms of the agreement, major shareholders of Trump Media cannot sell their shares for six months. That stipulation – commonly used to prevent newly public entities from signalling internal collapse or a lack of faith in the company’s future – applies to the former president.
Mr Trump has a 60 per cent stake in the company, which has been his presidential campaign’s de facto platform, reaping millions of dollars worth of free media coverage every time he fires off an incendiary post.
Wall Street has valued Trump Media at about $14bn, but experts say that number is deeply flawed. Digital World Acquisition Corporation, which became Trump Media on Tuesday following the merger, saw its share price spike almost 200 per cent so far this year.
The rising share price and the high valuation come even as Trump Media is losing money and despite Truth Social losing users.
University of Florida Finance Professor Jay Ritter told CNN, “this is a very unusual situation. The stock is pretty much divorced from fundamentals”.
More follows…