ODE Asset Management discontinues trading in fourth fund

O’Day Asset Management has suspended trading in a fourth fund after a “massive level” of withdrawal requests in the wake of sexual misconduct allegations against founder Crispin O’Day, which broke up 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 “orderly fashion” to meet the redemption.

The suspension is the latest move by the firm to stem the fall as investors tried to redeem their money from their funds over the past week. Oday Asset Management said on Thursday it was in “advanced discussions” about moving some funds and staff to rival companies.

That decision capped a tumultuous week for the firm since the Financial Times published an investigation last Thursday into allegations of sexual assault or harassment from 13 women against Crispin O’Day. He vehemently denies the allegations.

O’Day Asset Management earlier this week halted trading in three other funds — Brooke Developed Markets, LF O’Day Portfolio and Brooke Absolute Return — and closed the O’Day Swan fund due to a higher than normal volume of withdrawal requests.

The Swan Fund, which was managed by Crispin O’Day and has assets of €117 million, is being liquidated to return the money to shareholders. The measure to freeze withdrawals from other funds is one of the emergency actions taken by the firm to mitigate the effects of investors and institutions cutting ties with ODE Asset Management.

This week, the FT reported that JP Morgan was ending its relationship with the asset manager, serving notice on its key broking and custody relationships. Prime brokers provide hedge funds with stock lending, lending and other services, while custodians safeguard clients’ money. It is a regulatory requirement for a hedge fund to have a custodian.

JPMorgan and Goldman Sachs were followed by UBS in its move to end its relationship with Odey Asset Management as a prime broker.

O’Day Asset Management, which oversees $4.4 billion, is now in talks with rivals about offloading funds and managers, which could spell the end of the firm Crispin O’Day founded in 1991.

The firm said on Thursday that “any sale or rescheduling is considered subject to any relevant regulatory approvals and due diligence with a view to an orderly transition 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 Brooke Absolute Return Fund managed by James Hanbury. Oday Asset Management created the Brooke brand in 2020 and rebadged several funds with the moniker.