Trump in line for extra SPAC payday despite $4.5 billion selloff

The company’s board — made up of Trump Media insiders and members of the former president’s administration — could expedite that lockup to open the door for him to start capitalizing on his current stake of 78.75 million shares. But before that happened U.S. regulators would have to finalize some filings, and even if they did, selling any stock in the company wouldn’t be as simple as cashing a lottery ticket.

Liquidation risk

“It’s extremely unlikely that he’d be able to liquidate any substantial portion of his holdings without seriously tanking the stock price,” NYU’s Ohlrogge said. However, he added that if Trump sold shares at a fraction of “their current market price he’d still do exceptionally well in the deal overall.”

The actual value of Trump Media has been hotly debated given it lost more than $55 million last year while bringing just $4.1 million in revenue. As of Friday’s close, it was worth roughly $4.5 billion after shedding nearly half its value in less than a month.

The shares have become an expensive way for speculators to treat the stock market as a casino, raising memories of 2021’s meme stock mania.

Still, the big focus for investors is how quickly Trump can take advantage of his paper wealth and what that will do to the stock.

Trump is embroiled in a lawsuit with two Trump Media co-founders who claim he tried to dilute their stakes. A Delaware judge granted their request to amend the suit to include allegations that Trump retaliated against them by locking up their shares for six months, which they claim will cause “irreparable harm” to their finances. Trump himself is subject to the same restrictions.

Meanwhile, Trump is due to start his first criminal trial on Monday in Manhattan, where he’s accused of falsifying business records to hide a hush-money payment to a porn star before the 2016 election. It’s one of four criminal prosecutions Trump is facing as he campaigns to return to the White House.

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(With assistance from Erik Larson.)