‘Holy Grail’: Trump goes nuclear with a very peculiar deal |
What do Donald Trump’s social media company and a leading fusion energy researcher have in common? Nothing, but that hasn’t stopped them from announcing a merger.
While they might not have anything in common, Trump Media and Technology Group (TMTG) does have something that TAE Technologies needs. It has cash, political capital, a sharemarket listing and a committed investor base that could provide access to more.
Trump has what TAE Technologies needs.Credit: AP
The companies announced a merger last week that will see TAE, one of the world’s leaders in fusion technology, being backed into Trump Media in a deal the companies say values them at more than $US6 billion ($9 billion).
TMTG shares have shot up more than 50 per cent since the announcement, adding about $US1.6 billion to its market capitalisation and more than $US600 million to the (paper) net worth of Trump, who owns about 41 per cent of TMTG.
Despite the jump in the share price, TMTG’s shares are, at just above $US16 each, still down more than 60 per cent from their inauguration-inspired spike to around $US43 in January.
TAE is a company with serious credibility in its field, having spent the past 27 years researching and developing ways to commercialise fusion energy, raising $US1.4 billion from powerful backers like Google, Chevron, Goldman Sachs and Charles Schwab in the process.
It employs more than 400 people, including four Nobel laureates and 62 PhDs, and holds more than 1600 patents.
TMTG, which listed 18 months ago after launching its Truth Social social media platform (after Trump was de-platformed by the major social media companies after January 6), doesn’t have a lot of credibility.
Even though Trump posts government announcements (among other things) on it, Truth Social has a tiny user base of about 6 million. Elon Musk’s X has well over 400 million.
In fact, Truth Social’s performance has been so disappointing that TMTG has chased other lines of business in search of revenue and earnings.
TAE is a company with serious credibility in its field,........