Trump Media & Technology Group's Stock Plummets Following New Share Issuance
Trump Media & Technology Group's (TMTG) stock took a significant hit on Tuesday. This decline came after the company filed a prospectus on June 10 detailing a plan to issue up to 14.4 million common shares. Additionally, the company plans to allow the resale of 146.1 million shares by selling stockholders, including 78.8 million shares held by Donald Trump.
The registration statement lets these selling securityholders publicly resell the securities. The warrants covered by this registration statement are now eligible for cash exercise. If all these warrants are exercised for cash, TMTG could receive up to approximately $247 million in proceeds. Moreover, an additional $40 million in restricted cash on the company's balance sheet will become unrestricted due to this registration statement.
CEO Devin Nunes' Statement
Devin Nunes, the CEO of TMTG, stated, "Today marks another milestone for Truth Social. With our S-1 declared effective, we’re expecting to be well-positioned to energetically pursue TV streaming, other enhancements to the platform, and potential mergers and acquisitions. With approximately 620,000 retail shareholders supporting our vision, the company looks forward to expanding quickly and robustly."
Stock Performance
Following this announcement, TMTG's shares fell 9.82% during the regular session on Tuesday, closing at $31.31. The shares continued to drop in after-hours trading, falling an additional 13.93% to $26.95 at the time of publication on Tuesday.
By keeping these key points in mind, readers can understand the significant events affecting Trump Media & Technology Group's stock performance.
