SCHEDULE: Blue Water Acquisition Corp. III Undergoes Sponsor, Management Change

Yorkville BW Acquisition Sponsor, LLC has acquired a 20.9% stake in Blue Water Acquisition Corp. III, becoming its new sponsor and initiating a complete management and board overhaul.

Summary

• Yorkville BW Acquisition Sponsor, LLC (the "New Sponsor") acquired 6,325,000 Class B Ordinary Shares and 430,000 Private Units from Blue Water Acquisition III LLC (the "Prior Sponsor") for an aggregate purchase price of $7,200,000.
• The New Sponsor now beneficially owns 6,755,000 Ordinary Shares, representing 20.9% of the Issuer's outstanding Ordinary Shares as of November 25, 2025.
• The acquired securities include 430,000 Class A Ordinary Shares (from Private Units) and 6,325,000 Class B Ordinary Shares, which are convertible into Class A Ordinary Shares.
• Each Private Unit is comprised of one Class A Ordinary Share and one-half of one warrant, with each whole warrant entitling the holder to purchase one Class A Ordinary Share at an exercise price of $11.50 per share.
• The Private Warrants (215,000 in total) are not presently exercisable and will become exercisable beginning at the later of 12 months from the SPAC's initial public offering closing or 30 days after the completion of a Business Combination.
• All existing directors and officers of Blue Water Acquisition Corp. III resigned, and a new board of directors and management team were appointed, effective November 25, 2025.
• The New Sponsor and new Insiders entered into an Insider Letter, agreeing to vote in favor of any proposed business combination and not to redeem their Class A Ordinary Shares in connection with such a combination.
• The New Sponsor also became a party to the Registration Rights Agreement, with certain transfer restrictions and lock-up obligations removed for the New Sponsor.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. A change in sponsor and management can revitalize a SPAC's search for a business combination, which is generally viewed favorably. However, the inherent uncertainty of finding and completing a suitable merger keeps the sentiment from being strongly positive.

Positives

• A new sponsor, Yorkville BW Acquisition Sponsor, LLC, has taken control, potentially injecting new energy and strategic direction into the SPAC.
• The appointment of a new board of directors and management team, including Mark Angelo as Chairman and Kevin McGurn as CEO, signals a fresh start and renewed focus on identifying a business combination.
• The New Sponsor and Insiders have committed to voting their shares in favor of a proposed business combination and not redeeming their shares, aligning their interests with the successful completion of a merger.

Negatives

• The acquired securities are subject to certain transfer restrictions as outlined in the Insider Letter, limiting the New Sponsor's immediate liquidity options for a significant portion of its holdings.

Risks

• Failure to consummate a business combination within the time period required by the Issuer's amended and restated memorandum and articles of association could lead to the Issuer's liquidation and redemption of public shares.
• The New Sponsor and Insiders will not be entitled to liquidating distributions from the trust account with respect to their Class B Ordinary Shares if a business combination is not completed within the required timeframe.
• The Private Warrants are not presently exercisable and their value is contingent on the successful completion of a business combination and future stock performance.

Future Outlook

The Reporting Persons acquired their stake for investment purposes and intend to continuously review their investment. They may make further acquisitions or dispositions of Ordinary Shares. As the new sponsor, they plan to introduce the Issuer to potential business combination candidates or propose one or more business combinations. Mark Angelo, as a director, is expected to be actively involved in negotiations for prospective business combinations and identifying board candidates.

Management Comments

• Mark Angelo, President and Managing Member of Yorkville LLC and a Director of the Issuer, makes all investment decisions for YA II PN.
• The resignations of the previous officers and directors were solely in connection with the transactions contemplated by the Purchase Agreement and not due to any known disagreement with the Issuer.

Industry Context

A change in sponsor and management for a Special Purpose Acquisition Company (SPAC) like Blue Water Acquisition Corp. III is a significant event. It often signals a shift in strategy or a renewed effort to identify and complete a de-SPAC transaction. The entry of a new sponsor, especially one with investment management expertise like Yorkville, can be seen as a positive catalyst, potentially bringing new deal sourcing capabilities and a fresh perspective to a SPAC that has yet to announce a target.

Comparison to Industry Standards

• NA

Management Changes

Corporate Governance

Related Party Transactions

• The New Sponsor, Yorkville BW Acquisition Sponsor, LLC, acquired securities from the Prior Sponsor, Blue Water Acquisition III LLC, for $7,200,000. This transaction effectively transferred sponsorship and control of the Issuer.

Stakeholder Impact

• Shareholders: The change in sponsor and management could lead to a more focused and expedited search for a business combination, potentially increasing the likelihood of a successful de-SPAC transaction. However, the ultimate impact depends on the quality of the future target.
• Employees: The new management team will likely set new strategic priorities and operational directives.
• Prior Sponsor: Blue Water Acquisition III LLC has divested its entire stake and sponsorship role in the Issuer.
• Creditors: No direct impact mentioned, but the stability and future prospects of the company under new leadership could indirectly affect creditworthiness.

Next Steps

• Reviewing the investment in the Issuer on a continuing basis.
• Potentially making further acquisitions or dispositions of Ordinary Shares.
• Introducing the Issuer to potential candidates for a business combination.
• Proposing one or more business combinations with potential candidates.
• Mark Angelo, as a director, will be involved in negotiations for any prospective business combination and identifying candidates to serve on the Board.

Key Dates

Recommendation

The change in sponsorship and management for Blue Water Acquisition Corp. III introduces a new strategic direction and a committed team to pursue a business combination. This could be a positive catalyst for the SPAC, which is currently a blank check company. However, the inherent risks of a SPAC, particularly the uncertainty of identifying and successfully merging with a suitable target, remain. Investors should 'hold' to observe the new sponsor's progress in securing a definitive business combination, as the success of this transaction will be the primary driver of future share price performance.

Keywords

SPAC, Schedule 13D, Sponsor Change, Corporate Governance, Blue Water Acquisition Corp. III, Yorkville BW Acquisition Sponsor, LLC, Business Combination, Private Units, Warrants, Management Change, Beneficial Ownership