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It appears that a last-minute hurdle in the form of a series of lawsuits will fail to halt the proposed merger between the SPAC Digital World (DWAC) and the parent of the Truth Social platform, Trump Media and Technology Group (TMTG), paving the way for the shares of the combined company to soon start trading on the Nasdaq exchange, with Trump's 78.75 million shares in the post-merger setup now worth over $3 billion.
We reported a few days back that the planned merger between Digital World and TMTG was under threat from a number of lawsuits, including one where the co-founders of Trump's media-focused entity alleged that the former US President deliberately maneuvered to deprive them of a significant stake in TMTG that could have been worth hundreds of millions of dollars. Specifically, Andy Litinsky and Wes Moss claimed that their original 8.6 percent stake in TMTG was now subject to significant dilution via an “11th hour, pre-merger corporate maneuvering” that has increased the amount of authorized stock from 120 million shares to 1 billion shares. Trump's attorneys, on the other hand, claim that the duo's original services agreement with TMTG has already been voided, negating their locus standi.
This lawsuit appears to be a response to an earlier filing by the SPAC against its former CEO, Patrick Orlando, and the sponsor Arc Global Investments II, wherein Digital World alleged that Orlando had threatened to block the proposed merger between DWAC and TMTG to “obtain a windfall by way of extortion.” Of course, Arc Global has also filed its own lawsuit against the SPAC in the Delaware Court of Chancery, alleging that Digital World's current CEO, Eric Swider, and three other board members had miscalculated Arc’s stake in a manner that would deprive it over 2 million shares.
Against this backdrop, the Court of Chancery has now denied Arc Global's motion for an injunction against the planned meeting of Digital World's shareholders on the 22nd of March, where those shareholders are expected to formally approve the merger with Trump Media and Technology Group. DWAC's proposal to keep the disputed shares under an escrow seems to have satisfied the court.
This ruling means that the much-delayed merger between Digital World and TMTG can finally achieve closure in the next few days.
About the author: Writing is my one incontrovertible passion. Over the past six years, he has authored over 2,200 distinct articles on financial and tech-related topics, spanning nearly 1 million words. And he has been a member of Wcctech mobile team since 2025. As an alumnus of the University of Toronto, Rotman Commerce Program, I bring nuance, in-depth knowledge, and a unique perspective to every topic that I cover. When I'm not writing, I'm traveling the world, exploring hidden confectionaries and restaurants as an aspiring food connoisseur.
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