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Sell-off of MJ Hudson begins as accounting issues mount

Sell-off of MJ Hudson begins as accounting issues mount

Monday 20 March 2023

Sell-off of MJ Hudson begins as accounting issues mount

Monday 20 March 2023

A sell-off of stricken asset management business MJ Hudson is gathering pace amid growing problems at the firm.

The group, which has offices in Guernsey and Jersey, has faced deepening issues, with its auditor EY resigning last month, saying it has lost trust and confidence in the company’s management and its ability to provide accurate financial information.

It was confirmed two days later that CEO Matthew Hudson had resigned.  

Soon after that it emerged that an accounting review had uncovered loans to the company, some of which he personally guaranteed, full details of which the board were unaware of - including related payments to Mr Hudson’s consultancy company HCO Global.

That review is ongoing.

MJ Hudson’s board has said that there “have been a number of encouraging initial bids for all of the business units, as well as bids for individual business units, divisions and combinations thereof, from credible potential acquirers".  

Earlier this week it announced that the Group’s UK fund management business would be sold to Khepri Limited for £1m.

That special purpose vehicle is wholly owned by William Roxburgh and Michael Booth, directors within MJ Hudson's UK fund management arm.

Khepri will provide £1.8m. of working capital, of which £1.3m. is expected to be used as regulatory capital following completion of the deal.

Outstanding loans of £1.98m.  due from the Group to the companies involved, will be extinguished.

MJ Hudson has recently reached two short term overdraft agreements to provide it with working capital during the sales process, the first of £1.5m included Mr Hudson agreeing to provide the company with a shareholder loan of £100,000.

The second was for £1.75m.

MJ Hudson is headquartered in London, but has offices in 10 locations spread around the Channel Islands, the Americas and Europe.

On 17 October the company announced that it was in discussions with its auditors about “significant potential adjustments” in relation to its 2022 year-end accounts.

Then on 12 December it said that its shares would be suspended after it became aware of additional issues, including in relation to the reporting of historical trading of the business in the last financial year.

At the time the shares were trading at 13.13p, its market value of £26.7m. was down two-thirds on a year earlier.


Pictured: MJ Hudson's local office is on the first floor of Heritage Hall in Le Marchant Street.

MJ Hudson had been growing its presence in Guernsey.

In the summer of 2021, it bought locally-based fund administration Saffery Champness Fund Services.

At the time it said the deal would double its fund administration revenues in the Island.

It came soon after the acquisition of Guernsey-based regtech firm Clarus Risk, a deal done to extend the data and analytics services it could provide.

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