Trump-Linked SPAC Digital World Boots Out CEO As It Looks To Bring In New Management To Tackle 'Unprecedented Headwinds'

Zinger Key Points
  • Digital World has been stymied by federal investigations and a lack of shareholder backing in completing SPAC deal with Trump's TMTG.
  • The company is on a damage control exercise in order to win back shareholder confidence.

Digital World Acquisition Corp.'s DWAC troubles just got deeper, with the company announcing the ouster of its CEO.

What Happened: Digital World, a special purpose acquisition company, which has agreed to merge with Donald Trump’s Trump Media & Technology Group, the parent of the Truth Social platform, announced that Patrick Orlando, who served as chairman and CEO has been terminated with immediate effect. Orlando occupied the post for the past year and a half.

See Also: How To Invest In SPACs

The company announced board member Eric Swider as the interim CEO. Orlando will remain as a director on the board, it added.

As the board works out a succession plan, it aims to have a fully aligned management team to best meet the challenges, the company said. The executive change has come at a time the company is facing “unprecedented” headwinds. “Orlando's departure enables the Board to appoint new leadership, which it believes will restore confidence to the shareholders,” it added.

Swider, who is taking over as CEO on an interim basis, said the entire team will focus on a singular goal of accomplishing what is best for our shareholders. He noted that as of Nov. 28, the company had 400,000 shareholders in 30 different countries.

Why It’s important: Digital World hasn’t been able to close the SPAC deal with TMTG amid federal investigations and delays in shareholder approvals.

A Guardian report said last week that New York prosecutors investigated TMTG about payments received allegedly from two obscure entities controlled in part by a relation of an ally of Russian President Vladimir Putin. Digital World stock ended down 6% on March 15 in reaction to the news.

The stock has bounced off the level and received some support from the prospect of Trump’s arrest.

Digital World, which hit a high of $175 on Oct. 22 in the wake of the announcement of the SPAC deal with TMTG, is now a pale shadow of its old self.

Price Action: The stock settled Tuesday’s session down 1.73%, at $13.63, and lost an incremental 1.03% in after-hours trading, according to Benzinga Pro data.

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