Odey Asset Management has suspended trading in a fourth fund after a “significant level” of withdrawal requests in the wake of allegations of sexual misconduct against founder Crispin Odey hastened the collapse of one of London’s oldest hedge fund firms.
The firm said in a letter to investors on Friday that it was temporarily suspending trading in its $80 million special situations fund to sell assets in an “organized manner” to fulfill the buyback.
Meanwhile, Crispin Oddie resigned on Thursday as a director of ICP Holdings, a group of companies operating in the Lloyd’s of London insurance market.
The moves cap a tumultuous week for both the firm and its founder since the Financial Times published an investigation last Thursday into allegations of sexual abuse or harassment by 13 women against Crispin Oddie. He vehemently denies the allegations.
The firm said Thursday it was in “advanced discussions” to transfer certain assets and personnel to rival companies.
Odey Asset Management earlier this week suspended trading in three other funds – Brook Developed Markets, LF Odey Portfolio and Brook Absolute Return – and closed the Odey Swan fund due to a higher-than-usual volume of withdrawal requests.
The Swan fund, which was managed by Crispin Oddie and held €117m worth of assets, is being liquidated so the money can be returned to shareholders. The measure to stop withdrawals from the other funds is one of the emergency actions taken by the firm to mitigate the effects of the severance of investor and institutional ties with Odey Asset Management.
This week, the FT reported that JPMorgan was ending its relationship with the asset manager, warning of the prime brokerage and custodial relationship. Prime brokers provide hedge funds with stock lending, loans and other services, while custodians keep clients’ money safe. It is a regulatory requirement that hedge funds have a custodian.
UBS is also cutting ties with Odey Asset Management as prime broker, following Morgan Stanley, Exane, JPMorgan and Goldman Sachs.
Odey Asset Management, which oversees about $4.4 billion, is now in talks with rivals to offload funds and managers in a move that could spell the end of the firm founded by Crispin Odey in 1991.
The firm said on Thursday that “any sale or relocation is considered, of course, subject to all relevant regulatory approvals and due diligence, with a view to an orderly transfer of any assets and investors.” However, it did not name the companies involved in the discussions.
The firm’s largest funds include the Brook European Focus Fund, managed by Oliver Kelton, and the LF Brook Absolute Return Fund, managed by James Hanbury. Odey Asset Management created the Brook brand in 2020 and renamed several funds under the moniker.
Crispin Odey’s departure from ICP Holdings is detailed in documents first reported by Bloomberg.
The group includes a corporate member or underwriter at Lloyd’s, which had £104m of underwriting capacity last year, according to the company’s accounts.
Lloyd’s declined to comment on whether Crispin Odey was a market participant, but said “all Lloyd’s members and participants are expected to meet the standards we set and action may be taken where those standards are not met”.
Odey Asset Management also has an 8% stake in Aim Helios Underwriting, which owns a portfolio of insurance companies at Lloyd’s. Helios declined to comment.