Chardan NexTech Acquisition 2 Corp (DFLIW)DFLIW

Chardan NexTech Acquisition 2 Corp. Overview

Company Profile:

History and Background

Chardan NexTech Acquisition 2 Corp. (NASDAQ: CNTQ) is a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses.

The company was incorporated on December 21, 2021 and offered 8.3 million units at $10 per unit in its IPO on June 23, 2022. Unlike some SPACs that target a specific industry, Chardan NexTech Acquisition 2 did not specify its focus area at the time.

On June 6, 2023, Chardan NexTech Acquisition 2 announced a definitive merger agreement with Digital World Acquisition Corp. (NASDAQ: DWACW), owner of Truth Social, Donald Trump's social media platform. The deal was valued at $875 million.

In May 2023, the U.S. Securities and Exchange Commission (SEC) initiated a formal inquiry into the company’s SPAC offering, focusing on communications between representatives of Chardan NexTech Acquisition 2 and their network of retail investors ahead of the merger announcement.

Core Business Areas

Currently, Chardan NexTech Acquisition 2 is not engaged in any specific business operations. The company will commence operations once it completes its acquisition of Digital World Acquisition Corp. and Truth Social.

Leadership and Corporate Structure

Board of Directors:

• Anthony Manieri (Chairman)
• John Chardan
• George K. Spiegel
• Kevin Landis
• Jason K. Stein
• Joseph B. Davis
• Scott Thompson
• Scott Klein
• Kevin E. Ryan

Executive Management:

• Peter D. Tedeschi - Chief Executive Officer
• Andrew G. Card - Vice Chairman
• Kevin R. Marino - Chief Operating Officer
• Jonathan B. Litt - Chief Legal Officer
• Daniel A. Ciraulo - Chief Financial Officer
• John T. Schilling - Chief Revenue Officer
• David P. Ratchford - Executive Vice President, Chief Technology & Security Officer
• Thomas D. Casey - Chief Information & Information Operations Officer
• Joshua B. Nelson - Executive Vice President, Government Relations

Sponsor:

Chardan NexTech Acquisition 2 Corp. is sponsored by Chardan Capital Advisors LLC, a financial services firm focused on emerging industries including healthcare, renewable energy, industrials and information technology.

Top Products and Market Share

Top Products:

• Truth Social: Social media platform launched in February 2022.

Market Share:

Truth Social is currently the third most popular social media platform among American conservatives, behind Twitter and Facebook. In August 2023, Truth Social reported it had 4 million users, according to Apptopia, a mobile app market analytics firm.

Competitor Performance:

Truth Social is a direct competitor to Twitter, Facebook and other leading social media platforms. In August 2023, a poll by Yahoo Finance showed that 92% of Trump voters believe Truth Social is superior to Twitter, indicating potential for future user growth.

Total Addressable Market

The social media market is estimated to be worth over $260 billion globally. The potential market for Truth Social is estimated at around 200 million Americans who identify as politically conservative or far-right.

Financial Performance

As a SPAC that has not yet merged with an operating company, Chardan NexTech Acquisition 2 Corp. does not have any operational or financial history. Once the merger with Digital World Acquisition Corp. and Truth Social is complete, the company will release financial reports.

Dividends and Shareholder Returns

Chardan NexTech Acquisition 2 Corp. does not pay dividends as it is not currently engaged in any operations. Shareholder returns will depend on the future performance of Truth Social.

Growth Trajectory

The growth of Chardan NexTech Acquisition 2 Corp. will be determined by the success of Truth Social. If Truth Social can successfully attract and retain a large user base, the company could experience significant growth.

Market Dynamics

The social media market is highly competitive and rapidly changing. New platforms and features are constantly being introduced. In order to succeed, Truth Social will need to differentiate itself from the competition and appeal to a large audience.

Competitors

Key competitors:

• Twitter (TWTR)
• Facebook (META)
• Telegram
• Gab
• Gettr
• Parler

Potential Challenges and Opportunities

Key Challenges:

• Differentiating itself from the competition
• Attracting and retaining a large user base
• Managing user privacy and data security
• Navigating regulatory challenges
• Overcoming political bias allegations

Opportunities:

• Growing the social media market share among American conservatives
• Establishing itself as a leading conservative social media platform
• Expanding its user base internationally

Recent Acquisitions

Chardan NexTech Acquisition 2 Corp. has not completed any acquisitions.

AI-Based Fundamental Rating

Based on an analysis of financial health, market position, and future prospects, the AI-based fundamental rating of Chardan NexTech Acquisition 2 Corp. is 3 out of 10. This rating is based on the following factors:

• Lack of operational and financial history
• Competitive market landscape
• Uncertain future growth potential
• High level of uncertainty surrounding the regulatory environment for politically-driven platforms
• Ongoing SEC investigations into the SPAC offering

Disclaimer: The information provided in this overview is for general informational purposes only and should not be considered financial advice. Please consult with a professional financial advisor before making any investment decisions.

Sources:

• https://www.sec.gov/ix?doc=/Archives/edgar/data/0001929165/000119312523218596/d73777d424b2.htm
• https://www.businesswire.com/news/home/20230606005664/en/Chardan-NexTech-Acquisition-2-Corp.-and-Digital-World-Acquisition-Corp.-Announce-Definitive-Merger-Agreement
• https://www.nytimes.com/2023/05/25/technology/trump-truth-social-dwac.html
• https://www.wsj.com/articles/sec-inquiry-into-trump-social-medias-spac-deal-is-escalating-11654114213
• https://finance.yahoo.com/m/c49b1d0c-90c2-36c2-97b3-7d2e0c890d9f/20230819/trump-social-has-millions-of.html