Abrdn bags AI wealth management firm in first acquisition post-revamp
Abrdn has snapped up AI wealth management firm Exo for a not-yet-disclosed price, as the revamped investment company makes headway on its three-year plan.
The deal, expected to be completed in the final quarter of this year, will allow abrdn to offer wealth management via an app.
The investment group’s fee based revenue lifted by seven per cent to £755m in the past six months, up from £706m in the first half of 2020.
Shares sank 3.4 per cent in its afternoon trading, at 287.5p per share.
Abrdn’s diluted earnings per share swung from a loss of 22.7p in the first half of 2020, to 4.7p this year.
However, the group has instated an interim dividend of 7.3p.
John Moore, senior investment manager at Brewin Dolphin, said: “On paper, the shares look too cheap relative to the sum of Abrdn’s parts, which reflects worries about the company’s future direction in a rapidly changing and consolidating sector, as well as the continued pressure from a wider investor shift from active to passive investing.
“There are some positive signs, but despite some big moves over the last few years, there remain strategic questions over what is next for Abrdn.”
CEO Stephen Bird appeared upbeat regarding the results, which are the first financials under its revamped name abrdn and show a 52 per cent increase in adjusted operating profit.
“Each of our three growth vectors have delivered higher revenue and profits, contributing to the highest overall rates of growth since the merger,” he said.
The group, formerly known as Standard Life Aberdeen, changed its name to abrdn at the beginning of July, after proposing the move in April.
Abrdn reaped the rewards of low interest rates and central bank interventions, the group boss explained, adding that “market volatility is expected to continue due to Covid-19 and its unequal effects in different parts of the world.”
Positive trends in the wider market mean the group has held up well, according to equity analyst at Hargreaves Lansdown Nicholas Hyett said.
“Abrdn’s name change has coincided with a revenue recovery for the long suffering asset management group.
“Assets continue to leak out the door, but the flood has become a trickle. Positive trends in the wider market means total assets under management have held up well, and more assets in lucrative emerging market equity and property funds, together with a strong result in advisory, has boosted overall revenues.”