Digital World Acquisition Corp (DWAC) - the SPAC working to bring Donald Trump’s 'Truth Social' media venture public, has exploded over 70% higher this morning in its biggest rally since November after the SEC said it settled fraud charges against the SPAC.
The SEC said late Thursday that DWAC will pay an $18 million fine if it completes the deal with Trump Media & Technology Group.
As The Wall Street Journal reports, the SEC alleged that DWAC misled investors who participated in its $287 million initial public offering in 2021.
DWAC told IPO investors that it didn't have discussions with a merger target prior to raising money.
But DWAC officers had extensive merger discussions with Trump's company, Trump Media & Technology Group, the SEC said.
DWAC first disclosed the likely settlement in early July, when the SEC hadn't yet approved the deal.
When the headlines dropped last night, we had a feeling...
DWAC: latest mega squeeze— zerohedge (@zerohedge) July 20, 2023
With the short-interest ratio notably high...
And sure enough, DWAC is up over 70%...
The resolution clears one obstacle to DWAC's merger with Trump Media & Technology, which would become a public company if the deal is completed.
DWAC and Trump Media have until September to finish their deal, or the SPAC will have to return the millions it raised to investors.