Business Context and Reporting Period
Company: Oaktree Acquisition Corp. III Life Sciences (OACC)
Filing Type: Form 10-K (Annual Report)
Reporting Period: Fiscal year ended December 31, 2025
Business Overview: The Company is a Cayman Islands exempted company and a Special Purpose Acquisition Company (SPAC) formed to effect a merger, share exchange, or asset acquisition with one or more businesses in the healthcare or healthcare-related industries (biopharmaceutical, medical devices, diagnostics, specialized healthcare services). As of the filing date, the Company has no operating history, no revenues, and has not selected a specific business combination target. The Company is sponsored by Oaktree Acquisition Holdings III LS, LLC, an affiliate of Oaktree Capital Management, L.P.
Key Financial Metrics
| Metric | Value (as of Dec 31, 2025) |
|---|---|
| Net Income | $7,288,824 |
| Interest Income (Trust Account) | $8,484,511 |
| General & Administrative Expenses | $1,195,687 |
| Cash in Trust Account | $201,563,532 |
| Cash Outside Trust Account | $1,434,965 |
| Working Capital | $248,591 |
| Deferred Underwriting Fees | $6,719,660 |
| Shares Outstanding (Class A Public) | 19,199,029 |
| Shares Outstanding (Class B Founder) | 4,799,758 |
Note: The Company reported a net income primarily driven by interest earned on the Trust Account, offset by operating expenses. The Company has no operating revenue.
Material Changes vs. Prior Period
- Trust Account Growth: Cash held in the Trust Account increased from $193,579,022 in 2024 to $201,563,532 in 2025, an increase of approximately $7.98 million, driven by interest earnings.
- Net Income: Net income for the full year 2025 was $7,288,824, compared to $1,331,707 for the partial period from inception (June 28, 2024) through December 31, 2024.
- Operating Expenses: General and administrative expenses increased to $1,195,687 in 2025 from $351,806 in the 2024 partial period, reflecting ongoing operational costs as a public company.
- Permitted Withdrawals: The Company withdrew $500,000 from the Trust Account in 2025 for working capital purposes, compared to no withdrawals in 2024.
Guidance, Outlook, Risks, and Contingencies
Outlook and Timeline: The Company has until October 25, 2026 (24 months from its IPO closing) to consummate an initial business combination. If a combination is not completed by this date, the Company will cease operations, redeem public shares from the Trust Account, and liquidate.
Going Concern: The independent registered public accounting firm has issued an explanatory paragraph expressing substantial doubt about the Company's ability to continue as a "going concern" due to the mandatory liquidation date and the requirement to complete a business combination to avoid dissolution.
Liquidity: The Company relies on funds held outside the Trust Account (approx. $1.4 million) and permitted withdrawals from interest income to fund operations. The Sponsor and affiliates may provide working capital loans up to $1.5 million, which may be convertible into private placement units.
Key Risks:
- Failure to Complete Business Combination: If the Company fails to complete a transaction by the deadline, public shareholders will receive their pro-rata share of the Trust Account (approx. $10.50 per share as of Dec 31, 2025), and warrants will expire worthless.
- Trust Account Claims: While the Sponsor has agreed to indemnify the Trust Account against certain third-party claims, there is no guarantee the Sponsor has sufficient assets to satisfy such obligations, which could reduce the redemption amount below $10.00 per share.
- Geopolitical and Market Conditions: Risks include global conflicts (Russia-Ukraine, Israel-Hamas, Middle East), inflation, interest rate volatility, and regulatory changes (e.g., CFIUS review, outbound investment restrictions) that could hinder the search for a target.
- Dilution: The Sponsor's founder shares were purchased at a nominal price ($0.005/share), creating significant potential dilution for public shareholders upon conversion, even if the post-combination share price declines.
Investor Verification Checklist
- Trust Account Balance: Verify the current per-share redemption value in the Trust Account, which fluctuates based on interest rates and permitted withdrawals.
- Liquidation Deadline: Confirm the exact date by which a business combination must be consummated (October 25, 2026) and any potential extension mechanisms requiring shareholder approval.
- Sponsor Indemnity: Assess the financial strength of the Sponsor (Oaktree Acquisition Holdings III LS, LLC) to fulfill its indemnification obligations if third-party claims reduce the Trust Account balance.
- Working Capital Sufficiency: Monitor the cash balance outside the Trust Account to ensure it is sufficient to fund operations until the liquidation deadline or a business combination.
- Target Selection Criteria: Review the Company's stated focus on North American, British, or European life sciences companies with an enterprise value of $500 million to $1.5 billion.