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UK asset manager Abrdn is trialling alternatives to the Bloomberg terminals that make up the backbone of the investment industry, as part of a broader drive to slash about £150mn in costs.
In a recent memo to staff, Abrdn said it was exploring scaling back its Bloomberg terminal subscriptions and looking at cheaper alternatives, according to two people familiar with the situation. This was met with uproar by some people on the investment team, the people said.
The ubiquitous Bloomberg terminal is a data analytics and electronic trading platform, with an annual cost of around $30,000 for a single terminal, according to a person familiar with the matter.
At Abrdn there is roughly one Bloomberg terminal for each person in the investment team, which encompasses hundreds of people. A small number of people in equities are trialling a rival offering from US data and software company FactSet, which costs about a third of the price, one of the people said.
Potential cutbacks to the Bloomberg terminal subscriptions would only relate to those in equities and multi-asset teams, not those in the fixed income team as they rely on Bloomberg for pricing data, the person added. It forms part of regular negotiations with suppliers as part of managing costs, people familiar with the matter said.
“It’s not a decision being taken lightly as it would be a complicated thing to change,” said the first person. “I’m not desperately enthused at the prospect of having to change but, given the price differential, it’s worth exploring.”
An Abrdn spokesperson said: “No decision to change suppliers has been made. A small number of colleagues are trialling alternative technology so we can evaluate whether we can continue to meet all our needs but at a lower cost. If we decide to make any changes, this will be only done on the basis that our teams have the tools they need to work effectively.”
Bloomberg declined to comment.
Shares in Abrdn, which was formed by the 2017 merger of Standard Life and Aberdeen Asset Management, have shed two-thirds of their value since the merger. They have tumbled 24 per cent in the past 12 months alone, trailing peers, as investors have pulled assets and investment performance has faltered.
Abrdn has tried to slash expenses to boost its share price and return the asset manager to profitability under Stephen Bird, who has been chief executive since 2020. Last month Bird set out a plan to axe 500 jobs — about 10 per cent of the company’s 5,000-strong workforce — as part of a £150mn cost-saving programme.
Abrdn has also moved to slash employee benefits, halving redundancy payouts and reducing the length of paid parental leave by about a third, and closed, restructured or merged more than 100 of the group’s investment funds as part of the cost-cutting effort.
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