Thursday, January 20, 2022

Trump’s Media Company Investigated Over SPAC Deal - The New York Times

One day in April, a group of men gathered on a videoconference call to discuss a deal to bankroll former President Donald J. Trump’s planned media company.

Among the participants, according to two people familiar with the call, were Mr. Trump’s representatives and the chief executive and a future board member of Digital World Acquisition, a so-called blank-check company that would announce the deal with Mr. Trump six months later.

At the time, Patrick Orlando, Digital World’s chief executive, was also running several other blank-check companies, and it’s unclear which one he was representing on the videoconference.

Yet the month after the video call, which has not been previously reported, Digital World said in securities filings that it had not identified or begun talking with any potential merger targets.

Blank-check companies like Digital World, also called special purpose acquisition companies, or SPACs, sell their shares to investors first and then go looking for a business to merge with. They aren’t supposed to have a deal lined up before selling shares.

On Monday, Digital World said regulators were investigating. The Securities and Exchange Commission has requested information about the deal, including the identities of some investors and “certain documents and communications” between the SPAC and Mr. Trump’s company, Trump Media & Technology Group.

“The investigation does not mean that the S.E.C. has concluded that anyone violated the law,” Digital World said...

Read Full Story: https://www.nytimes.com/2021/12/06/business/trump-spac-sec-arc.html