Peptidase involved in the biosynthesis of the enzyme cofactor mycofactocin (MFT). Catalyzes cleavage of the MftC-modified MftA peptide to liberate its final two residues, which consist of a cross-linked valine-decarboxylated tyrosine dipeptide (named 3-amino-5-[(4-hydroxyphenyl)methyl]-4,4-dimethyl-2-pyrrolidin-2-one or ADHP). [mycofactocin precursor peptide]-C-terminal glycyl-N-{5-[(4-hydroxyphenyl)methyl]-4,4-dimethyl-2-oxopyrrolidin-3-yl}acetamide + H2O = 3-amino-5-[(4-hydroxyphenyl)methyl]-4,4-dimethyl-2-pyrrolidin-2-one + [mycofactocin precursor peptide]-C-terminal glycine MftE appears to bind one Fe(2+) and one Zn(2+) ion per subunit. Fe(2+) seems to be catalytically active while Zn(2+) could play an auxiliary role. Homooctamer. Belongs to the creatininase superfamily.