LONDON, UK:  MJ Hudson has acquired Bridge Group Limited, a funds service provider based in Ireland, conditional on regulatory approval.

The vendors are Mr David Dillon and Mr Paul McNaughton, both experienced practitioners in the funds sector, directors and the principal co-founders of the business.

Initial fixed consideration of €2 million is payable in cash, with deferred and additional earn-out consideration of up to €10 million, payable over a two-year period.

The consideration will be comprised of cash and new ordinary shares in MJ Hudson with the latter representing approximately 20% of the total. These shares will be allocated to directors, staff and employees of Bridge Group and will be subject to lock in arrangements for a period of at least 12 months from the date of issue.

The cash consideration will be funded from MJ Hudson´s existing cash resources. Completion of the acquisition remains conditional upon regulatory approval from the Central Bank of Ireland.

The acquisition will build on MJ Hudson’s specialist funds operations in London, Luxembourg and Guernsey and adds a strategically important geography to the Group´s network. The transaction is expected to be accretive to earnings per share (EPS) from completion.

Bridge Group is a Dublin based provider of specialist support services to the funds sector. Founded in 2005, it offers regulatory compliance, domiciliation and risk services and is authorised to provide third party management services to both UCITS and alternative investment fund platforms. Bridge Group has 27 permanent staff servicing 100 asset managers with over Euro 120bn in assets. 

For the twelve-month period to Sept 2020, Bridge Group is expected to have generated EBITDA of €0.5 million on revenues of €4.0m, on the basis of unaudited management accounts. Revenues are expected to grow by over 30% in the current year.

The business is being acquired on a debt free basis and had net assets of approximately €2.2m. The vendors of Bridge Group will remain fully active in their existing roles. All the staff will transition to MJ Hudson and the business will trade under the MJ Hudson brand. The deal substantially increases both MJ Hudson´s Outsourcing division´s revenues and staff numbers and capabilities.

Matthew Hudson, CEO, MJ Hudson, commented: “The acquisition of Bridge Group is a key milestone for  MJ Hudson´s Manco and regulatory platform offering. It means we can now offer clients representation in each of the principal UK and European fund centres as Brexit approaches. Together with our equivalent London, Luxembourg and Channel Islands offerings, MJ Hudson is now one of the largest independent (not part of banking group) regulatory platforms for asset management clients, and especially alternatives. The acquisition also gives us an extended Manco capability and a timely UCITs platform that complements our AIFM platforms in the UK, Luxembourg and Guernsey.”

“Alongside the wider resources, offerings and expertise of the MJ Hudson Group, the network effect we provide makes for a compelling proposition to the many new clients we welcome as part of the transaction. We are delighted that the Bridge Group team have decided to join us and we look forward to helping the business to grow.”

David Dillon, Director, Bridge Group, commented: “This is a very exciting transaction from Bridge Group’s perspective. We had been looking for a partner rather than an investor to strengthen our footprint internationally. Joining MJ Hudson hits a number of sweet spots. It strengthens our ability to provide clients with access to a regulated management company and governance services in Ireland , the UK , Luxembourg and Guernsey. It also gives clients access to a broader range of resources and international consultancies such as MJ Hudson´s specialist ESG Consultancy and its provider of Operational Benchmarking services.”

MJ Hudson, the asset management consultancy, provides legal services, outsourcing, analytics and complementary advice and support to fund managers, investors and their counterparties, together forming an end-to-end platform of services to asset management.

From its offices across Europe’s major asset management centres and North America, MJ Hudson’s team of 180 professionals works in all alternative and traditional asset classes, including private equity, venture capital, hedge funds, real estate, infrastructure, energy, private credit and the equity and debt capital markets.

The firm was admitted to the AIM market of the London Stock Exchange on 12 December, 2019 and trades under the MJH.L symbol.