Business Context and Reporting Period
Company: CSLM Digital Asset Acquisition Corp III, Ltd (CSLM)
Reporting Period: Fiscal year ended December 31, 2025
Business Type: Cayman Islands exempted company (SPAC) incorporated on July 26, 2024.
Current Status: The Company is a "blank check" company with no commercial operations. Its sole purpose is to effect an initial business combination (merger, amalgamation, or asset acquisition) with one or more businesses, focusing on digital assets, Web3 technologies, and financial services infrastructure in emerging and frontier markets.
Recent Activity: On August 28, 2025, the Company consummated its Initial Public Offering (IPO) and a concurrent Private Placement. On December 2, 2025, the Company announced a non-binding letter of intent for a potential business combination with First Digital Group Ltd.
Key Financial Metrics
| Metric | Value (Year Ended Dec 31, 2025) |
|---|---|
| Net Income | $1,847,947 |
| Operating Loss | $(861,051) |
| Interest Income (Trust Account) | $3,253,391 |
| Cash and Cash Equivalents | $3,108,288 |
| Trust Account Balance | $233,253,391 |
| Working Capital | $2,973,730 |
| Total Assets | $236,485,789 |
| Deferred Underwriting Commissions | $9,200,000 |
| Shares Outstanding (Class A) | 23,891,250 (including 23,000,000 subject to redemption) |
| Shares Outstanding (Class B) | 7,666,667 |
Material Changes vs. Prior Period
- Capitalization: The Company transitioned from a pre-IPO entity with no assets to a public company. Gross proceeds of $230,000,000 were generated from the IPO of 23,000,000 Units, and $8,912,500 from the Private Placement of 891,250 Units.
- Trust Account: $230,000,000 was deposited into the Trust Account upon IPO closing. As of December 31, 2025, the balance grew to $233,253,391 due to interest income.
- Profitability: The Company reported a net income of $1,847,947 for 2025, compared to a net loss of $22,820 for the period from inception (July 26, 2024) through December 31, 2024. The 2025 income is primarily driven by interest earned on the Trust Account ($3.25M) offset by operating expenses and share-based compensation.
- Liabilities: Deferred underwriting commissions of $9,200,000 were recorded as a non-current liability, which did not exist in the prior period.
Guidance, Outlook, Risks, and Contingencies
- Business Combination Deadline: The Company has 24 months from the IPO closing (August 28, 2025) to consummate an initial business combination. If unsuccessful, the Company will liquidate and redeem public shares.
- Target Criteria: The Company seeks targets with a fair market value of at least 80% of the Trust Account assets (excluding taxes and deferred fees). The target must be in the "new economy" sectors, specifically digital assets and frontier growth markets.
- Going Concern: Management has raised substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include adjustments that might result from the outcome of this uncertainty. The Company relies on the completion of a business combination or working capital loans to fund operations.
- Internal Controls: Management concluded that disclosure controls and procedures were not effective as of December 31, 2025, due to a material weakness related to a lack of properly designed and operating controls.
- Related Party Transactions: The Company pays its Sponsor $30,000 per month for administrative services. Officers and directors have entered into consulting agreements with monthly fees ($12,500 and $17,500). Founder shares were transferred to directors at a nominal price, resulting in $559,000 of share-based compensation expense.
- Risks: Risks include the inability to complete a business combination, volatility in the digital asset sector, geopolitical instability, and the potential for the Sponsor's indemnification obligations to be insufficient if third-party claims exceed Trust Account funds.
Investor Verification Checklist
- Trust Account Liquidity: Verify the current balance of the Trust Account ($233.25M) and the per-share redemption value, noting that interest income is subject to taxes.
- First Digital LOI: Confirm the status of the non-binding letter of intent with First Digital Group Ltd. and whether a definitive agreement has been signed.
- Going Concern Status: Assess the Company's ability to fund operations for the remaining 24-month window without additional financing or a completed merger.
- Internal Control Remediation: Review the Company's plan to remediate the material weakness in internal controls over financial reporting.
- Related Party Fees: Monitor the $30,000 monthly administrative fee and consulting fees paid to officers, which reduce working capital available for the search.
- Redemption Rights: Understand that public shareholders may redeem shares for their pro-rata share of the Trust Account upon the consummation of a business combination or liquidation.