Investors playing hardball with troubled Trump start-up as they threaten to take their money and walk: report
Donald Trump (Photo via AFP)

According to a report from Politico, the embattled partnership between Donald Trump's social media start-up and the company behind the SPAC that would take it public is on the verge of falling apart for good as potential investors either renege on their plans to fund it or demand a bigger return on their investment.

At issue is the proposed deal that was supposed to inject over a billion dollars into the increasingly troubled start-up before it went public -- which now may collapse under its own weight.

As Politico's Declan Harty reports, investors sensing weakness now want a bigger slice of the pie if they are expected to park their money in a business deal that has been struggling since its inception.

Reporting, "The group of more than three dozen investors who had planned to put $1 billion into the company have begun to waver as bad news keeps piling up around the deal," Harty wrote, "The hedge funds, trading firms and other major backers are questioning whether the financial riches that first attracted them to the transaction are still strong enough to hold their interest in a deal fraught with troubles, according to four investors who asked not to be named. Negotiations have been ongoing as some investors seek bigger potential profits in exchange for following through on commitments to put hundreds of millions of dollars into the venture."

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With a cloud hanging over it due to an SEC investigation and the company's inability to pay its bills, investment analysts are waving the red flag.

According to Kristi Marvin, of data research company SPACInsider, "This deal has taken more left turns than a doorknob. Now, it’s just got so much hair on it.”

Writing, "Eleven months ago, Trump Media & Technology Group unveiled plans to merge with a company called Digital World Acquisition Corp. in a SPAC deal," Harty added, "At stake for Trump and his startup — the company behind conservative social media app Truth Social — is hundreds of millions of dollars, marking the latest blow to the former president’s business empire since he left office."

The Politico report adds that one potential investor told them on the condition of anonymity, "that they do not expect to get back into the deal, adding that they had remorse about doing it to begin with considering the former president’s involvement. The investor said that much of the interest in the deal has revolved around the economics of it, with many set to profit from huge windfalls should it go through."

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