Digital World Acquisition Corp., the special-purpose acquisition company picked to take former President Donald Trump’s social media company public, unveiled a series of high-level departures on Friday since the end of last month—deepening potential worries for the firm as it struggles to finalize a deal amid regulatory investigations and broader market chaos.
In a regulatory filing released Friday morning, Digital World announced board member Rodrigo Veloso and chief financial officer Lee Jacobson sent letters of resignation to the company on December 9, while board member Luiz Philippe Braganza informed the firm of his departure on November 28.
The company did not immediately respond to forbes’ request for comment, but the filing states the resignations did not result from any disagreement with the firm on matters related to operations, policies or practices.
The slew of resignations come after another board member, Justin Shaner, abruptly resigned in early November—just days before the company held a crucial meeting to see whether shareholders would approve a measure to extend an early December deadline to complete the acquisition of Truth Social.
Shareholders ultimately approved the measure in a vote, giving the SPAC an opportunity to extend the deadline until September—which would be nearly two years after the company originally announced its deal to acquire Truth Social.
Digital World shares fell 4% in pre-market trading Friday to about $19.20—steepening a decline that has seen the stock lose more than 80% of its value since an all-time high of more than $100 in March.
Last October, Digital World announced plans to acquire Truth Social, the social app Trump launched last year to court conservative supporters, but the firm has struggled to make progress amid a slew of regulatory investigations into the matter. Both federal prosecutors and regulators—including the Securities and Exchange Commission—are probing the deal for alleged misrepresentations and certain transactions between Truth Social’s Trump-owned parent and Digital World. When asked at a conference last month about the uncertain timeline for the proposed merger, Digital World CEO Patrick Orlando simply said the firm “[doesn’t] have an update” on the regulatory review. On Thursday, Trump revealed Truth Social’s latest “major announcement”—a line of $99 non-fungible tokens, which themselves have struggled to renew traction amid a steep market downturn.
Digital World isn’t alone among SPACs struggling to close a deal after the economy descended into a bear market this year. Earlier this month, nearly $11 billion worth of SPAC deals were called off on the same day. Completed SPAC deals this year through September totaled about $39 billion—down nearly 90% from $341 billion over the same period last year, according to law firm White & Case.
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