As the stock market opens tomorrow, shares of Truth Social (NASDAQ:DJT) are expected to experience movement due to the social media company’s announcement of an all-stock deal to acquire most of WorldConnect Technologies’ (WCT) assets. This strategic move will assist Trump Media in establishing its content distribution network (CDN) for streaming TV, beginning with the Truth Social platform before expanding to other platforms.
The comprehensive deal encompasses agreements with WCT, Perception Group, Perception TVCDN, and FORA, granting Trump Media global rights to utilize new CDN technology. Additionally, there is an option for Trump Media to potentially acquire Perception entirely in the future. The deal is valued at up to 5.1 million shares of DJT’s stock and $17.5 million over three years, with the closing dependent on the full setup of Perception’s software.
In order to finance its growth, Trump Media has secured an agreement with Yorkville Advisors to issue up to $2.5 billion in shares over three years at a 2.75% discount to the market price. However, this move is likely to result in increased dilution for investors in the near future as they consider their investing decisions regarding Truth Social may require careful consideration and monitoring of market trends due to controversies surrounding former President Trump, who is the largest shareholder of DJT.
Despite this potential risk, investors can assess the last three months of trading activity on DJT stock during which timeframe DJT shares have declined by 23.38%. Controversies surrounding former President Trump have influenced the stock’s performance. Therefore, it is important for investors considering Truth Social may require careful consideration and monitoring of market trends before making any investment decisions.
Overall, this acquisition will help Trump Media establish a strong CDN platform that will enable it to distribute live TV across multiple platforms including Truth Social before expanding it further into other social media platforms.
Investors can monitor how this acquisition affects DJT’s stock performance and overall growth prospects while also keeping an eye on market trends that may impact their investment decisions related to social media companies like Truth Social (DJT).
