Another Stop The Presses moment. I swear, it’s a blessing that we deal with illuminated pixels around here and not linotype and newsprint, because I would be having a nervous breakdown with the second unexpected bomb shell in less than a day. But in the digital world, glory be, you can regroup and go roaring in a different direction at the drop of a hat.
Devin Nunes, former White House lawn ornament and soon to be former congressman (they must be dancing in the streets in Fresno, I know I would be) announced today he would be resigning from Congress to “take another opportunity.” The Hill:
“Recently, I was presented with a new opportunity to fight for the most important issues I believe in. I’m writing to let you know I’ve decided to pursue this opportunity, and therefore I will be leaving the House of Representatives at the end of 2021. …” Nunes told constituents.
“Rest assured, I have not, by any means, given up our collective fight—I’ll just be pursuing it through other means.”
GOP sources said Nunes has been hired to run Trump’s new social media platform.
A 10-term congressman, Nunes became a lightning rod during the Trump years when he was serving as the Intelligence Committee chairman. In April 2017, he was forced to recuse himself from his own panel’s investigation into Russia’s interference in the presidential election the year before for revealing classified information.
So he’s going to work for Truth Social or so GOP sources say. You want to know what the smart money says about the Truth Social platform? Reuters:
Dec 1 (Reuters) – Former President Donald Trump’s new social media venture is seeking to raise up to $1 billion by selling shares to hedge funds and family offices at several times the valuation it commanded in a deal with a blank-check acquisition firm in October, two people familiar with the matter said.
Trump Media & Technology Group, which has yet to roll out the social media app it says it is developing, already stands to receive $293 million if its deal to list in New York through a merger with blank-check firm Digital World Acquisition Corp (DWAC.O) is completed.
The deal valued Trump Media at $875 million, including debt. Trump Media is now seeking to raise up to an additional $1 billion at a valuation of close to $3 billion, to reflect Digital World’s share rally after Trump supporters and day traders snapped up the stock, the sources said.
It is the clearest indication yet that Trump and the Digital World dealmakers are seeking to capitalize on the market euphoria around their venture, which has so far been fueled by its ambitious goals rather than a business that is up and running.
This is bullshit. This is a pipedream, a scam. Elizabeth Warren spoke to the Securities Exchange Commission already about whether this is legal or not. She asked SEC Chairman Gary Gensler last month to investigate the planned merger for potential violations of securities laws around disclosure.
Truth Social is the first step in this Trumpian pipedream, followed by a video-on-demand service called TMTG+ that will feature entertainment, news and podcasts, and then, Trump sees himself eventually competing against Amazon’s cloud service and Google Cloud. This is psychosis. But people are buying it.
Digital World shares soared on Wednesday, as investors welcomed the news that the PIPE could dilute existing Digital World shareholders less than they expected by pricing at a level much higher than the customary $10 per share seen in most mergers with blank-check firms.
The shares, which had been trading down 6% before news of the $1 billion raise, rallied to close up 7% at $44.35 on Nasdaq, then extended gains in after-hours trade, rocketing up 31%, to $58.01.
Most PIPE transactions are inked before a deal to take a company public is rolled out, and it is far from certain that the companies will raise the entire $1 billion they are seeking following their deal announcement. Many Wall Street firms have snubbed the opportunity to invest, and many of the investors participating in the confidential road shows for the PIPE are hedge funds, family offices and high net-worth individuals, the sources said. Family offices manage the wealth of the very rich and their kin.
Weighing on the deal’s appeal is the reluctance of many investors to associate with Trump after he was banned from top social media platforms for encouraging his supporters to participate in the Jan. 6 attack on the U.S. Capitol, which was based on unsubstantiated claims of widespread fraud in last year’s presidential election.
Some hedge funds that backed the launch of Digital World, including Saba Capital Management and Lighthouse Investment Partners, have said they sold their shares to distance themselves from the Trump deal.
Distancing oneself from the Trump deal is the path of wisdom. Always. This entire social media fantasy of his is a shell company buying a shell company.
And now, in a comical plot twist that nobody except the Great Screenwriter In The Sky could invent and get away with, Devin Nunes is running the show. Sweet Jesus, what’s next? Is there a job for his cow? Trimming the grass or something?