John Wood Group plc: Institutional Activity and Share Class Dynamics in Early 2025

John Wood Group plc, a leading international engineering firm serving the energy sector, has seen notable shifts in its institutional shareholder base in early 2025, as revealed by a series of Form 8.3 filings under the UK Takeover Code. These filings, which track changes in significant shareholdings, offer critical insights into investor sentiment and strategic moves. Below, we dissect the data to understand what these transactions mean for investors.

Key Filings and Institutional Activity

1. Marathon Asset Management: Trimming Stakes at Lower Prices

Marathon Asset Management, a prominent hedge fund, reduced its stake in John Wood Group twice between March and April 2025:
- March 18: Sold 44,925 shares at £0.4384 per unit, reducing its holding to 4.02% of total shares.
- April 10: Sold an additional 9,064 shares at a sharply lower £0.2505 per unit, trimming its position further to 3.94%.

The significant drop in the sale price—from £0.44 to £0.25—hints at either a declining valuation of the company’s shares or a strategic decision to exit a portion of its position at lower prices. Notably, Marathon retains no voting rights over 3.46 million shares in its portfolio, likely due to third-party mandates or trusts.

2. Schroders plc: Position Adjustment Amid Volatility

Schroders, a major asset manager, held 5.11% of John Wood Group’s shares as of March 26, 2025. The firm sold 488,835 shares at £0.375 per unit, indicating portfolio rebalancing. Like Marathon, Schroders lacks voting discretion over 24% of its holdings (8.5 million shares), suggesting these shares are managed on behalf of clients.

3. Border to Coast Pensions Partnership: Large Sales at Higher Prices

Border to Coast Pensions Partnership, a pension fund, sold 1.25 million shares over two days in April at prices between £2.79 and £2.83 per unit, reducing its stake from 0.95% to an unspecified lower percentage. This contrasts sharply with the lower prices seen in Marathon’s transactions. The discrepancy likely stems from differences in share classes: Border to Coast held the 4 2/7 p ordinary shares, while Marathon dealt in Ordinary NPV shares, which may carry distinct rights or valuations.

4. Vanguard Group: A Contrarian Buy Signal

Vanguard, the world’s largest asset manager, purchased 11,788 shares at £0.26 per unit on April 14, slightly increasing its 4.40% stake. This move suggests Vanguard sees long-term value in the company, despite the lower price point, or is hedging against broader market movements.

Common Themes and Implications

Share Class Complexity

The stark price differences between transactions (e.g., £0.25 vs. £2.83) underscore the importance of understanding share class distinctions. Investors must verify whether they own Ordinary NPV shares or the 4 2/7 p ordinary shares, as these classes may have divergent rights, dividends, or liquidity.

No Derivatives, Clear Transparency

All filers reported no cash-settled or stock-settled derivatives, and no agreements tied to voting rights. This simplifies analysis, as there’s no hidden leverage or synthetic exposure distorting the picture.

Voting Rights Restrictions

Multiple institutions (Marathon, Schroders, Border to Coast) noted restrictions on voting discretion over portions of their holdings. This reflects a trend in asset management toward segregated mandates, where clients retain control over governance decisions. Such structures may limit the influence of these institutions in corporate governance, despite their significant stakes.

Conclusion: A Divergent Path for Investors

John Wood Group’s institutional activity in early 2025 reveals a mixed narrative. On one hand, Marathon’s aggressive sales at falling prices and Schroders’ trimming suggest caution around near-term valuations. On the other, Vanguard’s contrarian buy and the premium paid for 4 2/7 p shares (Border to Coast’s sales) hint at pockets of optimism or undervaluation in specific share classes.

Investors should:
1. Verify Share Class: The 4 2/7 p ordinary shares trade at nearly 10x the price of Ordinary NPV shares (£2.82 vs. £0.25), indicating potential structural differences (e.g., dividend rights, voting power).
2. Monitor Takeover Activity: Form 8.3 filings under the Takeover Code often precede or respond to potential bids. A sustained decline in Ordinary NPV share prices could invite a takeover, especially if institutional sellers continue to exit.
3. Consider Fundamentals: John Wood Group’s performance in energy engineering markets—particularly in renewables and offshore projects—will ultimately determine whether these share class disparities reflect true value or structural inefficiencies.

In short, while institutional moves signal cautiousness in parts of the equity structure, the strategic purchases by Vanguard and the premium activity in certain share classes suggest John Wood Group remains a strategic asset in the energy transition—but investors must navigate its complex share classes with care.