Hedge Fund Interest in Tungsten West PLC (LON:TUN): Ownership Concentration and Strategic Implications for Industrial Metals Exposure

The ownership structure of Tungsten West PLC (LON:TUN) has undergone significant shifts in late 2025, with hedge funds and institutional investors consolidating stakes that reflect a strategic alignment with the company's exposure to industrial metals. As global demand for critical commodities intensifies amid the energy transition and electrification trends, the concentration of ownership among specialized capital managers like Drakewood Capital Management Limited and Baker Steel Capital Managers LLP underscores a growing conviction in Tungsten West's positioning within the sector.

Ownership Concentration: A Closer Look

As of October 2025, Drakewood Capital Management Limited and its affiliated entities (collectively the Drakewood Concert Party) held a commanding 29.95% stake in Tungsten West, equivalent to 90,945,277 voting rights. This marked a substantial increase from earlier holdings, driven by the conversion of convertible loan notes into equity during late 2025. By January 2026, Henry Maxey-a key figure in the Drakewood group- further amplified his influence, boosting his voting rights to 14.70% (113,978,580 shares), effectively doubling his prior 7.24% holding.

Meanwhile, Baker Steel Capital Managers LLP, a specialist fund manager in natural resources and industrial metals, maintained a 13.56% stake (25,596,515 voting rights) as of October 2025. This position aligns with the firm's broader strategy of identifying undervalued equities in the resource sector, particularly those with exposure to critical metals. Other institutional players, including Hargreaves Lansdown Asset Management Ltd (11.97%) and Nigel Reed acquired a 3.5% stake in early 2026, further illustrate the sector's appeal to capital with a focus on industrial commodities.

Strategic Implications: Hedge Fund Focus on Industrial Metals

The strategic rationale behind these concentrated stakes lies in the hedge funds' thematic focus on industrial metals. Drakewood Capital Management Limited, established in 2017, operates as a discretionary fundamental hedge fund with a mandate to capitalize on global metals markets. Its direct investment in Tungsten West reflects a broader strategy to leverage supply constraints and long-term trends such as the energy transition. Similarly, Baker Steel Capital Managers LLP, founded in 2001, employs a bottom-up stock-picking approach to identify undervalued equities in the resource sector. The firm's Electrum strategy, launched in the past quarter, specifically targets mining companies involved in critical metals like copper, lithium, and silver-commodities central to electrification and green energy infrastructure.

This alignment is not coincidental. As global demand for industrial metals surges due to electrification and AI-driven technologies, mining equities are increasingly viewed as vehicles to capitalize on structural supply deficits. Tungsten West's operations, which include exploration and development in key metals, position it as a beneficiary of these trends. The recent issuance of 585 million new shares-a move likely aimed at funding expansion or debt reduction-further signals the company's intent to scale operations in line with sector-wide growth expectations.

Ownership Dynamics and Market Sentiment

The concentration of ownership among hedge funds with industrial metals expertise also raises questions about governance and strategic direction. For instance, Drakewood's 29.9% stake and Henry Maxey's 14.7% holding grant the group significant influence over corporate decisions, potentially aligning Tungsten West's strategy with the hedge fund's long-term vision for the sector. This dynamic contrasts with more passive institutional holdings, such as Hargreaves Lansdown's 11.97% stake, which may prioritize liquidity and diversification over active management.

Moreover, the entry of Nigel Reed with a 3.5% stake in early 2026 suggests continued confidence in Tungsten West's ability to navigate the volatile industrial metals market. Reed's acquisition, coupled with Richard Maxey's 8.708% holding, highlights a broader trend of strategic investors consolidating positions in companies with direct exposure to critical commodities.

Conclusion: A Sector-Driven Investment Thesis

The ownership concentration in Tungsten West PLC reflects a broader shift in investor sentiment toward industrial metals, driven by the energy transition and technological innovation. Hedge funds like Drakewood and Baker Steel, with their specialized expertise and thematic focus, are positioning the company as a strategic asset in a sector poised for growth. As Tungsten West navigates capital-raising initiatives and operational expansion, its alignment with these capital managers may serve as both a catalyst and a constraint, depending on how governance and market dynamics evolve. For investors, the interplay between ownership structure and industrial metals exposure offers a compelling lens through which to assess the company's long-term prospects.