This week, abrdn announced the completion of its acquisition of the healthcare fund management capabilities of Tekla Capital Management, a global specialist healthcare investment adviser based in Boston, Massachusetts.
With the global healthcare sector grappling with an ageing population and facing increasing rates of chronic illnesses, such as diabetes and cancer, the healthcare technology industry has grown rapidly. In the United States alone, healthcare expenditure has grown at a compound annual rate of 6% since the 1980s1, as the US population has surpassed 330 million and the obesity epidemic has worsened.
Biotech – a model of continued expansion
Encouragingly, all subsectors of healthcare have continued to benefit from modern breakthroughs in research and development with increased investment driving technological advancement and improved health outcomes. Sitting at the intersection of the rapidly growing technology and life sciences industries, biotech is particularly well positioned for continued expansion and to deliver groundbreaking healthcare innovations.
Recognising that the demographic trends underpinning the growth of the healthcare industry will persist, abrdn has established a firm-wide centre of excellence in the sector through its acquisition of Tekla, benefiting from their impressive track record of over 20 years investing in healthcare.
“As the world adapts to an environment where we are all living longer, there is a huge demand for capital in healthcare and biotech – matched with a demand from investors to support a clear global megatrend.”
Stephen Bird, abrdn CEO
Closed-End Fund Specialists
The Tekla acquisition comprised four NYSE-listed closed-end funds with £2.6bn in assets under management. Closed-end funds (CEFs) remain a key area of strength for abrdn, with the acquisition of four further CEFs from First Trust Advisers, announced last week.
Now the world's third largest CEF manager across the US and the UK, abrdn has c.£24bn* in assets under management in its CEF business. With abrdn executing more listed CEF acquisitions than any other investment manager over the last 15 years, this deal follows our strategy of building scale, focusing on asset classes where we have strength, and bringing assets under management to the group in a perpetual capital structure.
CEFs, particularly where they intersect with global megatrends such as healthcare technology will continue to be an area of interest for abrdn as we continue to grow our specialisms.
*£23.8bn as of 17 July 2023.
- Centers for Medicare & Medicaid Services, Office of the Actuary, National Health Statistics Group; U.S. Department of Commerce, Bureau of Economic Analysis; and U.S. Bureau of the Census, Morningstar.