Read how a smaller higher education provider might use the new merger and transformation resource in their context.
Advance HE, in collaboration with sector partners including IHE, has published a substantial new resource to support higher education institutions navigating merger, acquisition and strategic transformation where legal and governance change form part of the process. It is the most comprehensive resource of its kind for the UK HE sector, structured across three phases, covering 20 milestones and grounded in real institutional experiences. The principles it sets out - including honest decision-making, inclusive leadership, and protecting students through change - are robust and relevant to institutions of all sizes.
The framework is designed for the full complexity of a major institutional merger. But if you lead a smaller independent provider - who, like many IHE Members, are often working with lean teams, limited capacity and tighter timelines - you may find yourself thinking that some of its assumptions don’t quite match your reality and wondering where you fit. This blog is intended to help with exactly that.
What's in the resource?
It is structured around three phases:
- Phase 1, Decision Shaping covers institutional self-assessment, environmental scanning, options evaluation, and shared vision development. This lays the essential groundwork before any formal commitment is made and supports the development of an agreed business case for change.
- Phase 2, Decision Making starts with early legal considerations, due diligence, the non-binding Memorandum of Understanding, regulatory mapping, and the business case, although it recognises that these may be done in a different order depending on the context.
- Phase 3, Decision Taking covers execution: governance oversight, due diligence, programme management, cultural integration and working with regulators and advisers through to the point of legal change.
Within each phase, the framework provides milestone-by-milestone guidance on activities, risks, roles and decision-making for boards and leadership teams. It is thorough and well-structured and its emphasis on honest decision-making, staff and student wellbeing, and the protection of institutional identity, reflects values that will resonate with IHE Members. The inclusion of case studies drawn from real sector experience is particularly valuable, offering practical insight into how these principles play out in practice.
While the resource sets out the full range of structural options, its main illustrative scenario is the merger of two comparable institutions. In practice, acquisition, partial acquisition, joint ventures, group structures and management agreements are all legitimate paths. For smaller providers in the current environment, these are often the most realistic and appropriate solutions. They are not second-best alternatives to a merger of equals but strategic choices in their own right. The resource's framework is well-designed to evaluate all these options on equal terms, and smaller providers should feel confident in using it in this way.
Where your experience might differ
Phase 1 naturally encourages deliberate, reflective preparation - building shared understanding, exploring options and grounding the process in a clear sense of institutional identity before committing to a direction. For many smaller providers, the starting point is more pressured: financial stress, investor dynamics, regulatory concern or reliance on a single income stream can mean there is a far shorter runway. Smaller providers may need to work through the resource’s self-assessment tools at a faster pace and bring the more challenging questions around financial position and management capacity to the forefront, before moving on to the broader strategic work.
The Phase 2 guidance on cultural fit and the Memorandum of Understanding (MoU) is one of the resource's real strengths, with a focus on building trust, being honest about assumptions and getting the relationship right from the outset. For smaller providers, this sits alongside an equally important set of practical considerations that deserve explicit attention: ownership structures, debt and security arrangements, lease obligations, sponsor licence status, validation arrangements, litigation history, intellectual property and key person risk. Positive partnership language in a Memorandum of Understanding cannot substitute for clarity on these fundamentals, particularly where the deal is not between equals. Both dimensions matter, and neither should be allowed to overshadow the other.
The Phase 3 focus on programme management and communications sets out what good looks like: a dedicated project management function, clear message lines, workstream leads and a steady rhythm of engagement. Most small providers will not have this capacity in-house. The guiding principles are the right ones, but the challenge is to be realistic about what can be replicated with a smaller team to ensure ownership of key tasks is unambiguous and to avoid letting external advisers quietly fill gaps that in a larger provider would sit within the institution.
Be realistic about what can be replicated with a smaller team to ensure ownership of key tasks is unambiguous
Five things worth doing differently
1. Start with the harder questions
The resource recommends a period of reflection early in the process, considering mission, values and strategic identity. While all of this is important, for a smaller provider under pressure the first questions might need to be more direct:
- What is our financial position and how long is the runway?
- What are we most dependent on, and how exposed does that leave us?
- Are we doing this from a position of strength or necessity?
- Do we have the management capacity to lead a sustained process without the rest of the institution suffering in the meantime?
You should seek honest answers to these questions before moving on to the broader strategic work. At the same time, smaller providers should be clear about the strengths they bring - whether that is reputation, agility, specialist expertise or strong relationships - and approach discussions with an understanding that each party brings different but complementary value.
2. Don't let the merger of equals be the default
When working through the options in Phase 1, resist any drift towards treating a full merger as the natural ambition with everything else as a fallback. An acquisition by a stronger partner, a group structure that preserves your identity, or a joint venture in a specific area might be exactly the right answer. Use the resource's appraisal framework to assess all options with equal seriousness and make the case for whichever model genuinely serves your institution and your students.
3. Work out what you can't skip
Twenty milestones across three distinct phases is a lot to work through with a small team. As a rough guide: the work on financial viability, legal and regulatory mapping, due diligence and exit criteria cannot be skipped at any scale. The more expansive cultural diagnostics and stakeholder engagement activities are valuable, but they should not become prerequisites that delay the harder structural decisions. Be honest about your capacity and focus your energy accordingly.
4. Make sure due diligence covers the practical checklist
The resource's treatment of cultural fit and trust-building is excellent and deserves full attention. But alongside this, smaller providers need to be equally rigorous about the practical checklist: ownership and corporate structure; debt, security and financial obligations; material contracts; lease arrangements; sponsor licence and immigration compliance history; validation and awarding body relationships; any litigation or regulatory history; and key person risk. For a small provider, any one of these can determine whether a deal is workable. Good intentions in an MoU are not a substitute for clarity on the basics.
5. Build knowledge transfer into adviser relationships from the start
Where internal capacity is limited, external advisers - experts in legal, financial and regulatory matters - inevitably play a larger role. The risk is that dependency grows quietly, and when those advisers step back, no one inside the institution fully understands what was decided or why. From the outset, make knowledge transfer an explicit requirement in any adviser engagement to ensure your institution has the understanding and confidence to govern what it has been through.
A word on communication and confidentiality
A critical consideration for smaller providers is how communication is timed and controlled. Rumours of financial difficulty or merger discussions can damage recruitment, unsettle staff and undermine the very thing the process is trying to protect. Think carefully about who needs to know what, and when, and factor student recruitment timetables carefully into those decisions. The sequencing of communication - internal governance first, then wider staff, then external stakeholders - should be planned from the outset, not treated as questions to be resolved halfway through the process.
This sector resource is a serious and valuable contribution to governance and leadership in higher education and IHE encourages providers facing structural change, or those undertaking long-term strategic positioning and scenario planning, to engage with it. Approached with a clear sense of your own context, and with the adjustments above in mind, it is useful for providers of all sizes.