Shares of Truth Social (NASDAQ:DJT) could potentially see some movement when the stock market opens up tomorrow. This is because the social media company announced an all-stock deal to acquire most of WorldConnect Technologies’ (WCT) assets.
This move will help Trump Media set up its content distribution network (CDN) for streaming TV, which will start with the Truth Social platform before moving on to other platforms. This is part of a three-step plan announced in April to bring live TV to Truth Social.
The deal includes agreements with WCT, Perception Group, Perception TVCDN, and FORA and gives Trump Media worldwide rights to use new CDN technology. It also comes with the option to buy Perception fully in the future. The deal, worth up to 5.1M shares of DJT’s stock and $17.5M over three years, will close once Perception’s software is fully set up.
Trump Media also made a deal with Yorkville Advisors to issue up to $2.5B in shares over three years at a 2.75% discount to the market price in order to finance its growth. As a result, investors can expect more dilution to come their way.
Should You Invest in Truth Social?
There are still no analysts covering DJT stock, so we turn to the last three months of trading instead. Shares have been in open decline since May as drama surrounding former President Trump, DJT’s largest shareholder, has influenced the stock. As a result, DJT shares are down 23.38% during this time frame.
