FirstFT: Vote on Spac deal holds up potential $3.5bn windfall for Donald Trump

Good morning.

A legal stand-off between Donald Trump and one of his former business partners comes to a head later today, with a vote set to determine whether or not the former US president can unlock a potential $3.5bn windfall by taking the company behind his Truth Social network public.

The shareholder vote is to approve a takeover of Trump Media & Technology Group by a special purpose acquisition company called Digital World Acquisition Corporation.

But Patrick Orlando, whose Arc Global Investments is the largest investor in the Spac, has so far held out on casting his vote. Orlando is the former chief executive of the blank-cheque company and sits on its board and has threatened to withhold his support for the transaction.

The question over the listing, which if approved will go ahead next week, comes as Trump is facing mounting legal bills. Here’s more on the dispute.

Here’s what else I’m keeping tabs on today and over the weekend:

• Mexico’s economy: Mexico’s national statistics agency INEGI reports inflation data for the first half of the month. The agency is also expected to report January growth figures for the economy. The data comes after Mexico’s central bank became the latest Latin American country to cut interest rates.

• Central banks: Federal Reserve chair Jay Powell gives the opening remarks at a Washington event hosted by the US central bank. Federal Reserve board governor Michelle Bowman and Fed vice-chair Philip Jefferson will moderate panels at the event. Federal Reserve Bank of Atlanta President Raphael Bostic will appear at a conference on household finances.

• China’s Davos: Western chief executives, including Tim Cook of Apple and Darren Woods of ExxonMobil, will be in Beijing this weekend to attend the China Development Forum. There is uncertainty, however, around premier Li Qiang and whether he will host an annual roundtable with business leaders.

• Blinken in Israel: US secretary of state Antony Blinken will hold talks with Benjamin Netanyahu today in Israel as pressure builds for a ceasefire in Gaza. Later, the US will bring a UN security council resolution to a vote calling for an immediate six-week ceasefire in the Israel-Hamas war. All this comes a day after Republican speaker of the House Mike Johnson announced plans to invite the Israeli prime minister to address a joint session of Congress.

How well did you keep up with the news this week? Take our quiz.

Five more top stories

1. The US has urged Ukraine to halt attacks on Russia’s energy infrastructure, warning the drone strikes risk driving up global oil prices and provoking retaliation, according to three people familiar with the discussions. The repeated warnings from Washington were delivered to senior officials at Ukraine’s state security service and its military intelligence directorate, the people told the Financial Times. Read the full and exclusive story.

• More Ukraine news: The EU is looking to use its budget to purchase lethal weapons for Ukraine in what would be a significant shift in the defence policy of the bloc. EU leaders wrap up their two-day Brussels summit today.

2. The Bank of England governor has signalled that markets are right to expect more than one interest rate cut this year, saying he is increasingly confident inflation is heading towards target. Offering an upbeat take on the UK economy, Andrew Bailey told the FT that rate cuts were “in play” at future meetings of the Monetary Policy Committee amid signs that tighter policy had quelled the risk of a wage-price spiral.

3. In a sweeping antitrust lawsuit, the US has alleged that Apple locked millions of its users into a powerful monopoly that has made it one of the most valuable companies in the world. The suit paints a picture of a company that has spent years knowingly heading off competitive threats to its ecosystem, including on the App Store, in messaging with rival Android phones, on its “tap to pay” service and in the smartwatch market. Read more about the allegations.

• More regulation news: The UK competition regulator has launched a full-blown investigation into the proposed deal to create Britain’s largest mobile operator.

4. Shares in social media company Reddit leapt by almost half on its market debut in a vote of confidence for initial public offerings after two years of subdued activity. The stock closed at $50.44 after trading began yesterday at the New York Stock Exchange, up 48 per cent from its IPO price of $34 a share. Here’s more on Reddit’s debut.

• Opinion: The excitement over Reddit’s IPO has diverted attention from an important issue that could have greater ramifications for capital markets, writes Caroline Escott, chair of the Investor Coalition for Equal Votes.

5. A record amount of money has flooded into US corporate bond markets this year, as investors rush to lock in the highest yields in years ahead of an anticipated series of interest rate cuts by the Federal Reserve. Inflows into corporate bond funds have reached $22.8bn so far in 2024, according to fund tracker EPFR. the first positive start to a year since 2019. The flows have helped to push up prices and compress so-called spreads.

News in-depth

Stephanie Cohen joined Goldman Sachs straight out of college 25 years ago and became a partner while still in her 30s. In 2020 she became the first woman in years to run a core operating division at the storied Wall Street bank. That record made Cohen’s announcement this week that she was leaving for IT service provider Cloudflare particularly depressing for many Goldman women and led others to ask if Goldman’s efforts to promote women are stalling at the top.

We’re also reading . . . 

• America’s CRE hangover: Some players are finally getting more honest about America’s commercial real estate pain, writes Gillian Tett.

• Social price: Do you dislike being hounded online to buy stuff? Paying for social media could be the answer, writes Soumaya Keynes.

• ‘Super-revolutionaries’: A new generation of ultraconservatives is rising to prominence in Iran and laying claim to the Islamic revolution’s legacy.

Chart of the day

It is a fundamental truth in politics that a government that makes the electorate feel richer stands a good chance of enjoying favour. But in the US today, the hyper-partisan nature of politics has made it harder for people to move between political camps, and the relationship between economic sentiment and government popularity has broken down, while remaining strong in western Europe.

Take a break from the news

Are there any steaks left to be discovered? The FT’s Louis Ashworth consults butchers, food scientists and “meat influencers” who can’t quit searching for new ways to slice a cow.

Additional contributions from Gary Jones and Benjamin Wilhelm