Jun 28, 2021

MJ Hudson acquires Clarus Risk automation specialist

clarusrisk
assetmanagement
mjhudson
Regtech
3 min
MJ Hudson acquires Clarus Risk automation specialist
The asset management service provider MJ Hudson has acquired the risk management and reporting automation specialist, Clarus Risk

The London-based asset management consultancy, MJ Hudson, has acquired Clarus Risk, (Clarus) a leading risk management and reporting automation specialist in the regtech area of the fintech market. 

The news follows on from the company’s December 2020 acquisition of fund performance analytics firm, PERACS. 

According to reports, the decision to acquire Clarus Risk enhances the data and analytics services offered by MJ Hudson to its customers.

The regtech company was founded in 2011 and was named one of the REGTECH100 in September 2020 - an annual list of 100 of the world's most innovative regtech companies chosen by an expert panel of industry leaders and analysts that are considered essential service partners for rising fintechs.

Data also shows Clarus Risk's current AUM of products on its platform totals circa £10bn.

Regtech services for fintechs

Clarus Risk’s alternative asset fund manager and investor customers can access risk and regulatory risk reporting services as a managed service, or via software as a service (SaaS), through a customisable dashboard environment. 

Additionally, Clarus provides tailored quantitative research service, investment risk reporting, investment restriction reporting, private asset risk reporting, and liquidity stress testing.

A statement insured by MJ Hudson confirmed that Hilton and all Clarus staff have joined MJ Hudson to expand the team of quant engineers and risk professionals. The move will increase MJ Hudson’s London operations.  

The firm will also continue to trade under the name MJ Hudson Quantitative Solutions branding.

MJ Hudson streamlining investor operations

MJ Hudson’s services involve assisting fund managers and investors to operate more efficiently and invest with greater success.

The 150-strong team collaborates with fund managers, investors, and advisers in both traditional and alternative assets and provides them with law, fund management solutions, international administration, investment advisory, and data and analytics reporting.

Fifth acquisition by MJ Hudson

Reports show that the acquisition of Clarus is the fifth transaction of its type by MJ Hudson since 2018. The company was launched in 2010 and has experienced significant expansion over the past 24 months.

 

  1. 1) December 2020, PERACS, a fund performance analytics specialist
  2. 2) March 2020, Meyler Capital, an investor relations and marketing analytics business
  3. 3) 2019, ESG consultant and reporting business
  4. 4) 2019, Amaces, the FX and custodian benchmarking analytics firm

 

The strategic acquisition of these partners means MJ Hudson can provide its fund manager and investor clients with data, analytics, benchmarking, and reporting across risk, investment performance, investor relations, and ESG.

Currently, data and analytics services represent approximately one-third of the entire MJ Hudson Group.

Future-proofing customer services for MJ Hudson

Speaking about the company’s latest acquisition, Odi Lahav, COO, and head of MJ Hudson’s Data and Analytics division explained, “We are delighted to have Max and the team join the Group. 

“Risk analytics is a key building block in our developing data and analytics product set”

He said that the Clarus' FinTech business model fitted well into the current product suite, and its forward-looking strategic objectives – to offer comprehensive technology-focused solutions to asset managers and institutional investors – are fully aligned with those of MJ Hudson.

Lahav continued, “With the addition of Clarus, we can now offer clients enhanced levels of transparency, reporting, and analytical solutions across the critical areas of their business. The senior Clarus team also brings a wealth of technology and quantitative skills to the group and will form part of our research and innovation platform."

Max Hilton, Managing Director of MJ Hudson Quantitative Solutions, added, "The company's continued focus on the research and development of data-driven analytical tools, as well as its proven ability to attract blue-chip clients for these products and services, makes MJ Hudson the perfect home for our growing and evolving product set."

Image credit: Getty images (stock)

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Jul 23, 2021

Robinhood faces $35mn fine from New York DFS

Robinhood
IPO
Nasdaq
gamestop
2 min
Robinhood faces $35mn fine from New York DFS
Robinhood announced it had reached a ‘settlement’ with regulators and is on target for a $35bn valuation for its initial public offering

The renegade trading platform, Robinhood, which was central to the GameStop shares frenzy earlier this year, faces a US$35mn fine from New York financial regulators.

The company’s crypto division was issued with a wrist slap in 2020, following the red flagging of several “matters requiring attention”. Robinhood revealed it had reached a settlement with the New York State Department of Financial Services regarding the issues, which related to “alleged violations” of cybersecurity and anti-money laundering rules.

Robinhood valuation

The news follows on from the announcement earlier this week that the trading platform favoured by armchair investors, which almost broke Wall Street earlier this year, has an expected valuation of $35bn following its IPO.

Critics of the platform say Robinhood encourages “risky behaviour” among inexperienced (armchair) investors. The app has also been criticised for not informing customers that much of its profits are generated by routing their trades to Wall Street firms taking the other side, or so-called "payment for order flow."

Robinhood said last month they expected the DFS fine to be at the $15mn mark, adding it would be “the bottom of the range for our probable loss in this matter”. The $35mn penalty is on top of the record $70mn Robinhood incurred from US financial regulator FINRA in June, for “lax vetting and outages.”

However, the settlement indicates the company’s IPO will go ahead as planned, despite initial concerns the investigation could see the float delayed until later this year.

Robinhood floats imminent

Despite the regulatory hiccups, Robinhood priced its IPO between US$38-US$42 per share, giving the platform the US$35bn valuation and analysts predict the firm’s debut on the Nasdaq could occur as early as next week.

Reports suggest that 55 million shares will be offered. Robinhood founders, Baiju Bhatt and Vlad Tenev are also set to sell 2.63 million shares.

Robinhood democratising investment

Launched in 2013 by Tenev and Bhatt, who were Stanford University roommates, Robinhood’s founders will retain most of the voting rights after the IPO. Bhatt reportedly holds 39% of the voting power of outstanding stock, while Tenev holds 26.2%.

The online brokerage, which came under fire for its handling of the GameStop trading debacle, which saw the platform limit stocks to investors, states its mission is to “democratise” investing and is one of the most highly anticipated IPOs of the year.

Robinhood was valued at $11.7bn in autumn 2020 following a private equity funding drive. The new valuation will mean represent a three-fold increase in the company’s market value in less than 12 months.

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