Trump SPAC Digital World falls 5% after Musk proposes completing Twitter deal
Spencer Platt

Trump SPAC Digital World Acquisition (NASDAQ:DWAC) dropped some 5% Tuesday on word that billionaire Tesla CEO Elon Musk has proposed completing his stalled deal with Twitter (NYSE:TWTR), which serves as DWAC target Truth Social's main competitor.
DWAC, which is slated to take former President Donald Trump's social-media company and app Truth Social public, fell 5.3% on the news to close at $17.10.
Meanwhile, Twitter (TWTR) jumped some 22% on news that Musk has sent a letter to TWTR management proposing to proceed with his delayed $44B buyout deal at the previously agreed price of $54.20/share.
Digital World (DWAC) fell because some investors believe that a Twitter under Musk might allow Trump back on the Twitter social-media platform. Trump - who has been banned from Twitter (TWTR), Facebook (META) and Google (GOOGL) - is marketing Truth Social as an alternative outlet to those social-media giants.
Some DWAC investors are concerned about increased competition from a Twitter run by Musk, who has argued that his bid for TWTR is really about free speech.
Investors also likely see the possibility that Trump - who had about 80M Twitter followers before he was banned from that platform - could return to Twitter if Musk allows the former president back on.
Trump said in April he wouldn't return to Twitter (TWTR) even if Musk reinstated his account.
In may, Musk said he would reverse Trump's ban from the platform if the business mogul succeeded in taking over the social media platform with his $44 billion deal.
Digital World (DWAC) shares have plunged some 82% since the shares hit a high of $97 in early March. The stock has fallen amid concern about a Musk-led Twitter, as well as worries about several regulatory probes. Most recently, the stock sank after a shareholder vote on DWAC's deal to go public was postponed because the SPAC didn't have enough support from holders to approve a deal. Holders are now scheduled to vote on the deal next Monday. 
Last month, DWAC disclosed that it has received termination notices from PIPE investors representing $138.5 million of the $1 billion PIPE investment disclosed in December.