At least two investors withheld their money after learning that former President Donald Trump’s new media venture, Trump Media & Technology Group (TMTG), will go public via a SPAC, according to sources.
As a result of its merger with Trump’s new firm, Digital World Acquisition Corp., a SPAC, or Special Acquisition Company traded on the NYSE, saw its stock surge last week. The New York Times reports that Saba sold in the market’s “early hours” on Thursday, collecting a tiny profit.
“I knew the correct thing to do for Saba was to sell our whole holding in unrestricted shares, which we have already done,” Saba Capital Management founder Boaz Weinstein told Reuters.
Lighthouse Investment Partners has also pulled its investment. “Lighthouse was not aware of the expected merger and no longer holds unrestricted shares of the SPAC,” the investment firm said in a statement to Reuters on Friday.
According to CNBC, Saba owned 9.3% of the SPAC, and Lighthouse owned 11.2%, according to paperwork filed with the US Securities and Exchange Commission (SEC) in September.
Weinstein said in an emailed statement to Bloomberg, “Many investors are struggling to figure out how to incorporate their principles into their profession. This was not a close call for us.”
Retail traders continued to flock into the SPAC for a second day on Friday.
Last week, the stock of the SPAC company skyrocketed after it joined with Trump’s new firm.
The SPAC company, Digital World’s stock soared 357% in one day to $45.40 a share on Thursday. The stock continued to rise on Friday, reaching $175 per share in lunchtime trading, a 285% gain, before reversing course. The stock rose 107% to $94.20 per share by the conclusion of the day.