First Trust's 5% Stake in NCC Group: A Key Vote in Kroll's Cybersecurity Buyout

LONDON, UK – December 04, 2025 – A regulatory disclosure filed this week has cast a spotlight on the intricate power dynamics shaping the future of UK-based cybersecurity firm NCC Group plc. First Trust Advisors L.P., a major U.S. asset manager, revealed it holds a 5.01% stake in the company, a significant position that emerges just as NCC Group is navigating a takeover offer from global risk advisory firm Kroll, Inc.

The filing, a mandatory Form 8.3 disclosure under the UK's Takeover Code, is more than just regulatory paperwork. It provides a rare public glimpse into the influential role large, often quiet, institutional investors play when a company's ownership is in flux. With 15,774,987 shares under its control, First Trust is now a publicly identified stakeholder whose vote could be critical in the success or failure of Kroll's proposed acquisition.

The Anatomy of a Takeover Filing

Under the UK's stringent Takeover Code, transparency is paramount during a merger or acquisition. Rule 8.3 mandates that any party with an interest of 1% or more in an offeror or offeree company must publicly disclose their position and any subsequent dealings. This rule is designed to prevent information asymmetry and ensure a level playing field for all shareholders.

First Trust's filing on December 4th, detailing its position as of December 3rd, 2025, places it squarely in this regulatory spotlight. The disclosure confirms its significant holding, instantly flagging the asset manager as a key party in the ongoing takeover saga. The filing also noted a minor dealing: the sale of just 4,359 shares at a price of £1.45. While the price is notably higher than Kroll's offer of £1.20 per share—a point that could spark speculation about market sentiment—the minuscule size of the transaction relative to the total holding suggests it's likely routine portfolio rebalancing rather than a strategic change of heart. For a multi-billion-dollar asset manager, such a small sale is often noise, not a signal.

"These disclosures are fundamental to market integrity during a bid period," noted a London-based M&A legal expert. "They tell the offeror, the target, and the rest of the market who holds significant blocks of shares. It forces the key players to show their hands, preventing secret stake-building that could unfairly influence the outcome."

Kingmaker in the Wings?

The central question for investors and analysts is what this 5.01% stake means for Kroll's bid. The acquisition is structured as a Scheme of Arrangement, a common UK method for friendly takeovers. This requires approval from a supermajority of shareholders—specifically, at least 75% of the value of shares voted at a special meeting. NCC Group's board has already recommended the deal, but the final decision rests with shareholders.

In this context, a 5.01% block is far from trivial. While it cannot single-handedly block the deal, it represents a substantial portion of the vote. Kroll's advisory team will undoubtedly be aware that securing First Trust's support is a significant step toward reaching the 75% threshold. Conversely, if First Trust were to oppose the deal, it could galvanize other institutional investors who might feel the 120p offer undervalues the company.

First Trust is not typically known as an activist investor. Its business model, heavily centered on Exchange Traded Funds (ETFs) and other structured products, generally favors passive, index-tracking, or quantitative strategies. It's unlikely the firm will issue public demands or engage in a proxy battle. However, its fiduciary duty requires it to vote its shares in the best interest of its fund investors. This means its decision will be based on a cold, hard calculation of value. The firm's vote, while cast quietly, will speak volumes.

"You don't need to be an activist to be a kingmaker," a corporate governance analyst commented. "In a scheme of arrangement, every significant voting block matters. An offeror ignores a five percent holder at their peril. Their vote becomes a key piece of the puzzle that the acquirer must solve."

The Strategic Value of NCC Group

Beyond the M&A mechanics, First Trust's substantial holding reflects a deeper story about the perceived value of NCC Group itself. The company operates at the confluence of two critical technology sectors: cybersecurity and software escrow. Its cyber division provides consulting, security testing, and incident response in a world grappling with ever-increasing digital threats. Its software escrow business offers a unique form of business continuity, holding source code to protect licensees if a software vendor fails.

This combination makes it an attractive, if complex, asset. NCC Group has faced headwinds recently, with fluctuating financial performance leading to a strategic review aimed at streamlining operations and boosting profitability. For the fiscal year ending in May 2025, the company reported revenues of £349.5 million and an adjusted EBIT of £36.0 million, figures that highlight both its scale and its challenges in a competitive market.

Kroll's interest is a validation of NCC's underlying strategic importance. By acquiring the firm, Kroll, a leader in risk and financial advisory, would bolt on a suite of high-demand technical services, expanding its portfolio and cross-selling opportunities. The 120p per share offer, a 9.5% premium over the pre-announcement share price, signals Kroll's belief that it can unlock more value from NCC's assets than the public market currently does.

For an investor like First Trust, the calculus involves weighing this offer against NCC Group's potential as a standalone entity. Is the 120p cash offer a fair exit, or does the ongoing strategic review and the booming cybersecurity market promise greater long-term returns? The answer to that question will determine how it casts its pivotal vote, ultimately influencing whether NCC Group's future lies with Kroll or on its own independent path.