(Bloomberg) — Saba Capital Management quickly sold its entire stake of unrestricted stock in blank-check company Digital World Acquisition Corp. on Thursday after discovering it planned to merge with former President Donald Trump’s new media venture.

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“I knew that for Saba the right thing was to sell our entire stake of unrestricted shares, which we have now done,” founder Boaz Weinstein said in an e-mailed statement. “Many investors are grappling with hard questions about how to incorporate their values into their work. For us, this was not a close call.”

Saba has invested in more than 400 SPACs, or special purpose acquisition companies, according to the statement, which was earlier reported by the New York Times.

Getting out quickly of the unrestricted stock has cost Saba. Digital World soared 357% on Thursday after retail investors piled into the stock. The price doubled on Friday to a record, with an almost 10-fold jump over two days.

Saba is one of a number of hedge funds that bought into Digital World, run by Chief Executive Officer Patrick Orlando, in September. Others include Highbridge Capital Management, Palm Beach, Florida-based Lighthouse Investment Partners and D.E. Shaw & Co., according to data compiled by Bloomberg.

Lighthouse said it no longer holds unrestricted shares of the SPAC. D.E. Shaw also sold all of its unrestricted shares, according to a person familiar with the matter.

Read more: Moneyman Behind Trump’s Media Company Runs a Firm in Wuhan

Trump announced late on Wednesday that the deal will enable him to build a new social media presence after Twitter and Facebook banished him from their platforms after the January insurrection at the Capitol. The new company will be called Truth Media, according to a statement from Trump Media & Technology Group, which said it plans for the new business to be operating by the first quarter, ahead of the 2022 mid-term elections.

Hedge funds have rushed to invest in SPACs in the past couple of years. They have the ability to redeem shares for cash at the time of a merger, which makes the trades relatively low-risk. Warrants given to investors in the initial public offering, coupled with the possibility that the shares will trade above the redemption price, provide upside on the trade.

The funds frequently have little involvement in the management of a SPAC or its choice of a target.

Weinstein’s wife, Tali Farhadian Weinstein, narrowly lost out this year to become the Democratic candidate for the Manhattan district attorney’s race.

(Adds scope of two-day increase in fourth paragraph. The attribution in the sixth paragraph was corrected in an earlier version.)

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Source: Saba Capital Dumps Unrestricted SPAC Stock on Trump News

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