CSLM Digital Asset Acquisition Corp III, Ltd Annual Report - How They Did This Year

Thinking about CSLM Digital Asset Acquisition Corp III, Ltd? You've come to the right place. We'll explain their past year's performance simply, helping you decide if it fits your investments.

Let's dive into what CSLM Digital Asset Acquisition Corp III, Ltd (CSLM) is all about, based on their annual report for December 31, 2025.

What Kind of Company Is CSLM?

First things first, CSLM isn't a typical company that sells products or services. It's what's called a "blank check company" or a SPAC (Special Purpose Acquisition Company). Think of it like a special investment tool. Its main goal is to find and buy a private company. Once they buy that company, it essentially becomes public through CSLM.

As of December 31, 2025, CSLM had no business operations. Its main job was preparing for its IPO and searching for a merger target. CSLM has a limited time to complete a merger. This is usually 18 to 24 months from its IPO date. If it fails, it must close down. It then returns money from its Trust Account to public shareholders.

Their Big Debut: The IPO and What They Raised

CSLM went public on August 28, 2025, through an Initial Public Offering (IPO). Here's a quick look at the numbers:

• They sold 23 million "units" to the public. This raised $230 million.
• Each unit cost $10.00. It included one regular share (Class A ordinary share). It also included half of a "warrant." A warrant is an option to buy another share later. This option is at a set price of $11.50 per full warrant. Warrants typically become active 30 days after a merger. They expire five years later, or earlier if the company redeems them.
• They also sold an additional 891,250 units in a "private placement." These went to their sponsor and underwriter. This brought in another $8.9125 million. These private units also cost $10.00 each.
• They put $230 million from the public offering into a special "Trust Account." This special account is at a U.S. bank. It safely holds the money until they find a merger target. The account also earns interest. The $8.9125 million from the private placement covered IPO expenses. It also funded working capital and other operating costs. These costs were outside the Trust Account.
• The IPO cost about $8.05 million in underwriting fees. $4.6 million was paid immediately. $3.45 million will be paid after a merger. CSLM also had other offering costs of about $1.1 million.

You can find their shares on Nasdaq. Regular shares trade as "KOYN." Warrants trade as "KOYNW." Units (shares plus warrants) trade as "KOYNU." These started trading separately on September 19, 2025. As of December 31, 2025, CSLM had 23,000,000 Class A ordinary shares outstanding. It also had 5,750,000 Class B ordinary shares. These are founder shares held by the sponsor.

What Kind of Company Are They Looking For?

CSLM wants to merge with a company. This company must be digitizing financial infrastructure. This includes exciting areas like:

• Digital assets: These include cryptocurrencies, stablecoins, and NFTs. They also include tokenized securities.
• Web3 technologies: These cover DeFi protocols and dApps. They also include blockchain-based identity solutions.
• Financial services infrastructure: This means tech solutions. These help with payments, asset management, and trading. They also support lending within the digital asset world.
• Blockchain-driven business models: They also seek innovative blockchain-driven companies. These use distributed ledger technology for new products. They also improve services or operations. This includes RegTech solutions for digital assets.

They also like companies in emerging and frontier markets. These are basically developing economies. This focus aims for higher growth. It targets less saturated markets. It also seeks to build digital infrastructure. This is for regions with less developed traditional finance.

Big News: A Potential Deal on the Horizon!

On December 2, 2025, CSLM announced a "non-binding letter of intent." This was with First Digital Group Ltd. First Digital leads in stablecoins and digital asset infrastructure. Stablecoins are cryptocurrencies designed for stable value, like FDUSD. First Digital has a strong presence in Asia and globally.

What does "non-binding letter of intent" mean? It's like saying, "We're seriously talking about getting married." But we haven't set a date or signed the license yet. It's an important step, showing a potential partner. However, there's no guarantee a final deal will happen. This LOI usually outlines key terms. It includes First Digital's proposed value range. It also covers the potential deal's general structure. These details can still change.

They still need to work out specifics. They must conduct extensive due diligence. They need to negotiate and sign a "definitive agreement." Regulatory approvals (like from the SEC) are also needed. Finally, they need shareholder votes. An LOI announcement often makes the SPAC's stock volatile. Investors weigh a successful merger against the deal failing. CSLM's deadline to complete a merger is August 28, 2027. This LOI is a critical step towards that goal.

Who's Behind CSLM?

A group called CSLM Acquisition Sponsor II, Ltd. set up the company. This sponsor group is managed by Charles T. Cassel III and Vikas Mittal. They are linked to investment firms like Consilium Investment Management (CIM) and Meteora. These firms specialize in investment management and SPACs. The CSLM leaders have financial and SPAC experience. They're using their networks and expertise to find a good target company.

The sponsor's incentives align with their ownership. They own 5,750,000 Class B ordinary shares (founder shares). These represent 20% of shares after the IPO. They also own 891,250 private placement warrants. Each warrant lets them buy one Class A share at $11.50. These shares and warrants become valuable only after a successful merger. The stock must also perform well. This strongly motivates the sponsor to find a good deal.

So, How Did They Perform This Year?

CSLM is a blank check company. So, it had no sales or profits from its own business in 2025. Its "performance" meant completing its IPO successfully. It raised significant money. Then it identified a potential merger target. The big news for 2025 is definitely the potential deal with First Digital.

Financially, for the year ending December 31, 2025:

• CSLM earned $1.2 million in interest. This came from money in its Trust Account.
• The company spent $2.5 million on operating expenses. These were mainly general and administrative costs. They also included legal and accounting fees for the IPO. And for searching for a target company. Directors' and officers' liability insurance was also a cost.
• As a result, CSLM reported a $1.3 million loss. This was for the year ending December 31, 2025.
• As of December 31, 2025, the Trust Account held about $231.2 million. This included the initial $230 million and earned interest. Outside the trust, CSLM had about $6.4 million in cash. This cash was available for working capital.

What's Next?

CSLM's main focus is finalizing a deal with First Digital. (Or another company if that doesn't work out). Then they need to complete the merger successfully. This involves more due diligence and term negotiation. They also need shareholder and regulatory approvals.

Until then, they'll earn interest from the Trust Account money. However, time is running out. CSLM's deadline to complete a merger is August 28, 2027. If no deal is reached by then, CSLM must close. It will return public shares at about $10.00 each. This includes any earned interest. In that case, warrants would expire worthless. The sponsor's founder shares would also lose value. The company might ask shareholders to extend the deadline. This usually means the sponsor adds more money to the Trust Account.