Does XWell End Well for Trump Boys?

The Trump boys' playbook involves investing in companies and seeking federal business.  Once federal contracts are garnered the boys have choices.  They can invest more (as in the case of Dominari), stand pat or monetize all or part of their asset.  

Propublica ran a story on the Trump boys investment in XWell, Inc.  It states:

The Trump administration awarded a small biosecurity company nearly $40 million to screen for Ebola and other infectious diseases just months after a firm linked to President Donald Trump’s elder sons invested in its parent company, according to records and interviews. 

The contracts, one to screen for Ebola in several U.S. airports and the other to respond to disease outbreaks in the Democratic Republic of Congo, are seven times the total value of government contracts the company had directly received before. 

The company, XpresTest, has years of experience monitoring for COVID-19 and other diseases for the government at U.S. airports. That makes its parent, XWELL, an unusual hybrid, selling both spa treatments and biosecurity services.

The Trump boys' holdings in XWell come via their stakes in both Dominari Holdings and American Ventures, a Dominari investment offering.

It's essentially a private equity holding, where Dominari is the private equity underwriter (PEU), American Ventures the PEU fund and XWell the affiliate to be monetized.

After getting the federal contracts XWell plans to spin off the XpresTest unit alongside the division that does airport facials and other massage services.

XWell's stock price hit $40.40 during the COVID epidemic when the firm was conducting airport testing.  It now trades at 54 cents, which places their NASDAQ listing in jeorpardy.

They need the expertise of new board member Gerald Reid, who has advised private equity firms as a capital markets leader.  Senior Advisor Cindy Friedman, M.D. can work to keep the CDC happy as XWell works through this financial hiccup.

Time may reveal the mechanisms used to steer federal business to Trump family related organizations and it may not.

Politicians Red & Blue love PEU and their new TechGod brethren.  Increasingly, more are one.