I would be very surprised if it was down to one small problem. The chaps in the FOI usually work with a company to keep the show running. They don't just pull approvals for little or no reason.
I have no information as to why this has happened, but blaming it on "one engineering issue (not specified) on a sub contracted aircraft" doesn't seem to get close to me.
Someone has obviously stuffed up and it may be a paperwork issue, but it is still an almighty slap in the chops from the CAA.
Is MM still the FOI for GSM? He was one of the people who pulled the plug at Emerald. Maybe he just won't put up with any nonsense at all now?