April 17, 2024

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Republican mega-donor Jeff Yass owns shares in Trump Media Merger Partnership

Republican mega-donor Jeff Yass owns shares in Trump Media Merger Partnership

Jeff Yass, a Wall Street financier, major Republican donor and major investor in TikTok's parent company, was also the largest institutional shareholder in the shell company that recently merged with former President Donald J. Trump's social media company.

A December regulatory filing showed that Yas's trading company, Susquehanna International Group, owns about 2% of Digital World Acquisition Corp, which merged with Trump Media & Technology Group on Friday. This stake, about 605,000 shares, is worth about $22 million based on Digital World's last closing stock price.

It's unclear whether Susquehanna still owns those shares, because large investors disclose their holdings to regulators only periodically. But if it retains its stake, Mr. Yass' company will become one of Trump Media's largest institutional shareholders when it begins trading this week following the merger.

Digital World's shares have risen about 140 percent this year as a merger with the parent company of Truth Social, Mr. Trump's social media platform, nears and Mr. Trump becomes the presumptive Republican nominee for president.

“Susquehanna is a market maker and has no economic interest in Trump Media,” the company said in a statement. “A company's long position is offset by short positions of the same size.”

Regulatory filings show that the company used offset securities to try to reduce its gains or losses per share.

The company's statement did not comment on whether the company still had a stake in Digital World, or on the relationship between Mr. Yass and Mr. Trump.

Mr. Yas has been in the news recently for multiple reasons. Mr. Yass' company is a major contributor to Republican candidates and political action committees that support libertarian and conservative causes, including Club for Growth, and is also a major shareholder in ByteDance, the parent company of TikTok. American investment companies Susquehanna, BlackRock, General Atlantic and others own 60% of ByteDance.

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This month, the House of Representatives passed a bill to force ByteDance to sell TikTok, the Chinese-controlled social media company.

The Club for Growth has sought to pressure Republicans in Congress to oppose any attempt to ban TikTok if it remains under China's control, and Mr. Yass has helped the conservative organization fund the effort. (The Club for Growth had opposed Trump's re-election campaign, but appears to have reconciled with it.)

Mr. Trump had supported banning TikTok in the United States, but recently reversed his position. A few weeks ago, he admitted to having a brief meeting with Mr Yas – which was set for 2022 Wall Street Journal column As a “never supporter of Trump” — but he said the two men never discussed TikTok.

A person close to the Trump campaign said Mr. Yass is expected to make a large donation to a group supporting the former president's political campaign. Mr. Yass said through a spokesman that he had never introduced to Mr. Trump and had no plans to do so.

Susquehanna, which facilitates trades in thousands of stocks using mathematical models, isn't the only company that could make money from Digital World. In February, Digital World revealed that it had raised $50 million from a group of institutional investors to cover expenses related to the merger. Investors loaned the company money that could be converted into shares. The investors in the deal have not yet been revealed.

Overall, hedge funds and trading firms owned about 5 percent of Digital World's 30 million shares at the end of last year. The vast majority of Digital World's roughly 400,000 shareholders are individual investors, many of whom are supporters of Mr. Trump.

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The surge in Digital World's stock prices this year has increased the value of Mr. Trump's 79 million shares in Trump Media by billions of dollars. Mr. Trump is also being issued a class of stock that gives him at least 55% voting power on all shareholder actions.

The merger was completed ahead of Trump's Monday deadline to secure a bond to cover a $454 million fine imposed by a judge in a civil fraud case.

The former president's shares in Trump Media could provide him with a financial lifeline to raise the money needed to acquire bonds. But to do that, he needs Trump Media's seven-member board to remove restrictions that prevent him from selling stock or using stock as collateral for bonds for the next six months.

The board includes Trump's eldest son, Donald Jr., and three former members of his administration: Kash Patel, who was chief of staff to Trump's acting defense secretary; former US Trade Representative Robert Lighthizer; and Linda McMahon, former Administrator of the Small Business Administration.

Ms. McMahon is chairing a major fundraiser for Mr. Trump scheduled for April 6 in Palm Beach, Florida, according to a copy of the invitation. The event is co-hosted by John Paulson, the billionaire investor, and includes a number of Wall Street financiers as chairs. Mr. Yas was not mentioned as one of them.

Maggie Haberman Contributed to reports.