Digital World Acquisition Corporation, which operates as a "blank check" company and plans to merge with former US President Donald Trump's social media company, fired its CEO earlier this week.
Eric Swider, a different director, was chosen by the corporate board to act as interim CEO. However, Patrick Orlando, the previous CEO, will continue to serve as a company director.
"Due to the unprecedented headwinds faced by the company, the board agreed it was in the best interest of its shareholders to select a new management team to execute an orderly succession plan and set strategic operating procedures for the company in this new phase," the company said in a news release.
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In October 2021, Trump's newly formed media company, Trump Media & Technology Group (TMTG), announced a deal to go public by merging with DWAC. The deal is now in doubt amid investigations by the Justice Department and the Securities and Exchange Commission, which have delayed its closing.
Late last year, shareholders approved extending the deadline to close the deal to September 2023. Around that time, DWAC's chief financial officer and two independent directors left.
Challenges for both DWAC and TMTG, which operate the Truth Social app, have continued this year. TMTG's founders launched the company as a way for Trump to connect with his followers after he was cut off from major social media platforms following the Jan. 6, 2021, attack on the U.S. Capitol by his followers. TMTG's fortunes are tied to Trump, whom the company bills as its chief traffic driver.
But Trump has now returned to the platforms from which he was ousted. He posted to Alphabet Inc.'s YouTube and Meta Platforms Inc.'s Facebook on March 17, the same day YouTube restored his channel. Meta reinstated Trump's Facebook and Instagram accounts earlier this year.
Trump's Twitter account was reinstated in November by the platform's new owner, Elon Musk, but Trump has yet to post there.
A blank-check firm, also known as a SPAC, is a publicly traded shell company that raises cash to acquire and take public a private company, allowing the target to sidestep the stricter regulatory checks of an initial public offering.
(With inputs from Reuters)