Marathon's Calculated Bet on John Wood Group's Final Act

LONDON, UK – November 25, 2025 – In the world of mergers and acquisitions, timing is everything. A regulatory filing made public today reveals that Marathon Asset Management, a London-based investment firm, has increased its holding in John Wood Group plc to a significant 3.77% stake. Ordinarily, such a move by a major investor would signal a strategic power play—an attempt to influence a board, push for a higher price, or perhaps even scuttle a deal.

But this is no ordinary situation. Marathon’s disclosure, detailing recent share purchases made on November 24, comes after the fate of the Scottish engineering giant has, for all intents and purposes, already been sealed. This isn't a prelude to a battle; it's a sophisticated financial maneuver in the final act of a long and troubled corporate drama.

A Deal Already Decided

Just one week ago, on November 17, shareholders of John Wood Group overwhelmingly approved a takeover by Sidara Limited, a Dubai-based engineering firm. In a decisive vote, approximately 90% of investors accepted Sidara’s cash offer of 30 pence per share. The acquisition is structured as a court-sanctioned scheme of arrangement, a binding mechanism that effectively makes the deal a foregone conclusion once approved.

This follows a tumultuous period for the Aberdeen-based company. Before Sidara’s successful bid, Wood had spurned multiple offers from US private equity firm Apollo Global Management in 2023, arguing they undervalued the company. Yet, the months that followed were punishing. The company's market value plummeted as it grappled with deep-seated operational and financial issues, culminating in a five-month trading suspension on the London Stock Exchange.

Sidara’s initial offer of 35 pence per share was itself reduced to the final 30 pence price after its due diligence uncovered what an independent review later confirmed as "material weaknesses" in Wood's financial reporting and controls. The discovery triggered a probe by the Financial Conduct Authority and led the company's own auditor to issue a rare disclaimer of opinion on its 2024 accounts, highlighting a material uncertainty about its ability to continue as a going concern. Against this backdrop, Sidara’s revised offer was not just accepted but recommended by Wood's board as the "best option for its shareholders, creditors and wider stakeholders."

Decoding the Arbitrage Play

So why is Marathon Asset Management increasing its stake now, when the price is fixed and the outcome certain? The answer lies not in strategy, but in arithmetic. The firm’s Form 8.3 disclosure, a mandatory filing under the UK Takeover Code for any entity with an interest over 1%, reveals purchases at prices around 0.25 pounds, or 25 pence, per share. With Sidara committed to paying 30 pence per share upon the deal's finalization, Marathon is positioning itself for a classic merger arbitrage play.

This strategy involves buying the stock of a company being acquired at a discount to the deal price and capturing the spread when the transaction closes. The discount—in this case, roughly 5 pence per share—represents the market's pricing of the minimal risk that the deal could, for some unforeseen reason, fail before the final court sanction. For an institutional investor like Marathon, which can deploy significant capital, this small but predictable spread translates into a low-risk, high-certainty return.

Marathon’s move is essentially a high-conviction bet on the completion of the transaction, not its terms. The firm is wagering that the path from shareholder approval to the final court sign-off and delisting will be smooth. Further evidence for this interpretation is a footnote in the disclosure stating that Marathon lacks voting discretion over 3.4 million of its 26 million shares. In a situation where influencing a vote is no longer relevant, this detail reinforces that the investment is a pure financial calculation, not a bid for control or influence.

Capitalizing on the Endgame

The actions of firms like Marathon Asset Management highlight a crucial, often overlooked, aspect of the M&A lifecycle. While headlines focus on bidding wars and activist campaigns, significant capital is deployed in the final, procedural stages of a deal. These arbitrageurs provide essential liquidity to the market, allowing shareholders who wish to exit their positions before the final payout to do so. In turn, they absorb the final sliver of execution risk in exchange for a predictable profit.

For John Wood Group, this activity marks the beginning of its final chapter as a publicly traded entity. Once a stalwart of the FTSE 250, the company's journey has been a cautionary tale of market shifts, operational missteps, and the immense difficulty of navigating the energy transition. The cash injection and new ownership from Sidara are intended to stabilize the business and provide a foundation for a turnaround away from the unforgiving glare of public markets.

Marathon’s filing is more than just a regulatory notice; it is a clear signal from the world of sophisticated finance. It indicates that the smart money believes the Sidara-Wood deal is set in stone. As the final legal and administrative steps are taken to complete the acquisition, investors like Marathon are quietly and efficiently positioning themselves to profit from the certainty that has finally emerged from months of turmoil.