Genuine question: does the thought process below make sense?A...

Genuine question: does the thought process below make sense?

1. A hedge fund heavily shorts a company.
2. They decide to close their short position.
3. To do this, they buy a large number of shares on the market.
4. This pushes their holding above the 5% threshold, requiring them to declare themselves as substantial shareholders.
5. They return the borrowed shares used for shorting to the original lenders.
6. This lowers their holding below the 5% threshold, meaning they must declare they’ve ceased to be substantial shareholders.

Is this how it works? Could this scenario be happening?