Donald Trump appears to be scrambling for funds to pay a $464m (£365m) fraud fine. Could the stock market ride to his rescue?
Trump Media, which runs the social media platform Truth Social, is poised to become a publicly listed company, after a majority of shareholders of Digital World Acquisition Corp voted on Friday to acquire it.
Mr Trump is due to have a stake of at least 58% in the merged company, worth more than $3bn at Digital World's current share prices.
It's an astonishing windfall for Mr Trump in exchange for a business whose own auditor warned last year it was at risk of failure.
Never mind the many red flags associated with the deal, including unresolved lawsuits from former business partners. There's also an $18m settlement that Digital World agreed to pay last year to resolve fraud charges over how the merger plan came together.
Backers of Digital World - the vast majority of whom are individual investors instead of Wall Street firms, many apparently Trump loyalists - seem undaunted.
"This is putting your money where your mouth is for free speech, to save your country, potentially losing it all," Chad Nedohin, a deal supporter, said recently on his show DWAC Live, on the video platform Rumble.
Digital World, or DWAC (pronounced D-whack), is what is known as a SPAC, or a shell business created expressly to buy another firm and take it public.
The company will now be renamed Trump Media & Technology Group and could start trading on the Nasdaq stock exchange under the ticker DJT as soon as next week .
The deal is unlikely to immediately resolve Mr Trump's most pressing financial issues, such as his New York fraud penalty.
The former president is barred from selling his shares for at least six months - though the new company could grant him an exemption.
Mr Trump could also try to get a loan, backed by the value of the shares. But in this case, analysts said a bank would probably lend him significantly less than the shares are worth on paper, given the potential risks of the business.
That hasn't stopped some of his supporters hoping their backing will help.
Mr Nedohin, who identifies himself on his website as a Canadian "worship leader" and goes by Captain DWAC on Truth Social, declined to be interviewed.
But on his show this week he urged investors to approve the deal, speculating it could help the former president in his legal battles.
"If the merger is complete Friday at 10am and Trump all of a sudden has 120 million shares of DJT that's worth three, four, five $10bn, who knows? He could easily leverage that to get a loan," he said.
The risk that Digital World shareholders will lose money on their investment is significant, according to analysts.
Shares in the company rose on Friday ahead of the approval, to more than $45 apiece, before later falling to about $41.
That's down from the highs it reached after the plans to purchase Trump Media were announced.
But it still implies Trump Media has a value of more than $5bn, which is a lot given it brought in just $3.3m in revenue in the first nine months of last year and lost nearly $50m.
The merger will provide an influx of more than $200m in cash to Trump Media, which it could use for growth and expansion.
But for now Truth Social, which launched to the general public in 2022, branding itself as an alternative to major social media platforms like Twitter and Facebook, remains small.
It claims about 8.9 million sign-ups and in regulatory filings Trump Media warns prospective investors that it does not track metrics like user growth or engagement that could give them a sense of its operations. And it says it has little intention of doing so.
Outside firms estimate Truth Social received about 5 million visits in February. By comparison, Elon Musk's X, formerly Twitter, and recently valued by one investor at about $14bn, received more than 100 million.
Analysts said Digital World was a prime example of a "meme stock", in which the share price is divorced from a company's fundamentals - and near-destined to fall, eventually.
"With Trump Media, I expect that it will collapse but whether it's going to occur a week from now or two years from now and how rapidly ... those things are really difficult to predict," said University of Florida finance professor Jay Ritter, who tracks public listings.
Marco Iachini, senior vice-president of research at Vanda Securities, said individual investors piled into Digital World stock after the Trump deal was announced, and again in January, after he won the Iowa primary.
This week, he said there's been less activity, a sign that professional firms may be the ones driving the trading.
Whatever is motivating buyers, Mr Trump, whose main contributions to Trump Media have been his name and posts on the platform, appears poised to be the top beneficiary.
"It's an enormous transfer of value from [investors]... to Trump, which stands to be extremely lucrative for him," says Michael Ohlrogge, a law professor at New York University who has studied listings of companies such as Trump Media.
