Trump’s social media company claims to have raised $1 billion
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Donald Trump’s new social media company says it has reached agreements with investors to raise $1 billion (£755 million) in advance of a potential IPO.
Early next year, the Trump Networking & Technology Group plans to release Truth Social, a social media app.
Mr Trump was banned from using Twitter and Facebook after the attack on the US Capitol in January.
Earlier this year, Mr Trump announced his intention to establish Truth Social, claiming that it would allow people to talk without prejudice based on political ideology.
Digital World Acquisition, a so-called special-purpose acquisition company (spac), or blank cheque firm, has joined with the Trump Media & Technology Group on the initiative.
Spacs are shell firms founded expressly for the purpose of combining with a private company and taking it public, which became a hot topic in the US stock market at the start of this year.
Mr Trump’s firm announced on Saturday that it had received $1 billion from a diversified collection of institutional investors, but did not name them. According to reports, the social networking company is now worth about $4 billion.
Following the January 6 attack on the US Capitol in Washington, DC by his supporters, Mr Trump was barred from using major social media platforms for fear of inciting further violence.
It came after Mr Trump claimed, without evidence, that last year’s presidential election had been tainted by rampant fraud.
Trump Media & Technology Group partnership with Digital World Acquisition has already been criticised.
Senator Elizabeth Warren, a Democrat, urged the Securities and Exchange Commission last month to look into the planned merger for possible securities law violations. The SEC has refused to say if it intends to take any action.
Truth Social is expected to go live in the first quarter of 2022. According to a presentation slide on the company’s website, the business plans to compete against Amazon.com’s AWS cloud service and Google Cloud in the future.