Trump is watching his fortune gets shrunk by $4 Billion
The wealth of former President Donald Trump amassed through the public offering of his media company, Trump Media & Technology Group, has been significantly reduced recently, as the expiration of the ban period scheduled for September 19 approaches.
The company, which operates the social media platform Truth Social similar to X, has lost nearly $6 billion in value in the past four months.
Meanwhile, the company’s largest shareholders have been unable to sell their shares because of a lock-up agreement imposed after the company went public through a merger with a special purpose acquisition company in March.
The stock fell to a record low on Thursday, wiping $4.1 billion off Trump’s fortune, as he owns about 60% of the company. His current stake is worth about $2.1 billion.
Paul Karger, co-founder and managing partner of Twin Fox, said buyers should be wary, saying, “I’ve seen the fallout from a lot of previous SPACs, where it’s been a race to the bottom, with everyone trying to get out at any cost”.
The comment reflects growing concern about the company’s fate in the current climate.
The company is also facing additional pressure because some of its founders and key investors, including Andy Letinsky, Wes Moss and Patrick Orlando, have been unable to sell their stakes, with the pair seeing losses of more than $500 million.
Investors are anticipating a wave of selling after the ban ends, and are watching for any developments that could impact the stock price.
In an attempt to reassure investors, Trump said at an event on Friday that he had no intention of selling his shares, suggesting he didn’t need the money.
His comments sparked some optimism, with the stock jumping 12% after his comments.
However, Trump’s comments did little to galvanize investors to support the company, especially after he returned to Elon Musk’s X platform and posted heavily on it.
Trump Media faces a number of challenges, including a continued decline in the value of its shares, which have fallen to $17.97 from $40.58 in mid-July.
There are also concerns about the impact of the upcoming election on the value of the shares, with some seeing the company’s fate as tied to Trump’s chances in the presidential election.
Michael Klausner, a Stanford law professor, noted that the company wasn’t trading on its economic fundamentals, reflecting the great uncertainty investors face.
As the ban nears its end, it will be interesting to watch for any changes in stock prices and how they impact Trump’s financial situation and future investments.
