Lessons Learned from a Successful Merger

Michael Ginzberg

September 3, 2026

Mergers and acquisitions among higher education institutions are becoming increasingly common as the changing environment for higher ed makes it more and more difficult for smaller institutions to survive on their own. We recently completed another successful merger transaction as the adviser to and representative of a smaller institution that recognized how difficult it would be to survive and thrive independently and decided to take action. Participating in this process from very early on until a definitive transaction was signed gave us a front row seat and offered significant insight into what is required for a successful merger.

Our client was a small graduate institution, approximately 1,000 students. It had a limited, specialized program structure, with several programs that were very highly regarded in their fields. An accounting analysis of the programs (attributable revenues and expenses) showed that almost all programs were cash flow positive and together they generated a significant surplus. The overhead costs of running the university, however, were approximately twice that surplus. Though the school’s net assets could support deficit operations for a few years, eventually the accumulated assets would run out, and in the meantime, there would be no funds available to invest in the improvements and innovations the school needed to maintain its position as a leader in its fields.

Lesson one: Decide to seek a partner early, from a position of institutional strength. The President and the Board made the decision to seek an institutional combination – a partnership, merger, or acquisition – early, while they still were in a strong position. Making the decision to seek a partner (or acquirer) before immediate action was critical – i.e., before closure was imminent – provided our client with more options, made them a more attractive candidate, gave them more choices of which institution to combine with, and ultimately resulted in better terms for the transaction.

Lesson two: Clarify your objectives at the start of your search. The President established a Board committee to direct and monitor the partnership process. One of the committee’s first tasks was to define the criteria for any combination. They defined two sets of criteria – the must haves and the nice to haves. Driving the list of must haves was the desire to preserve the institution’s mission and its legacy. Understanding the difference between these two sets of criteria was extremely helpful, provided the critical framework for soliciting and evaluating potential partners, and guided conversations among the Board, the President, and the consultants throughout the process.

Lesson three: Recognize that developing a successful alliance is a long and complex process. Developing the case to best present the institution, soliciting and evaluating potential partners, gathering materials to stock a data room (the repository of documents and information to be shared with potential partners), soliciting bids, and negotiating terms were all lengthy processes, and they are not things most colleges or universities do in the normal course of business. Having a consultant to support and guide these processes was essential, and involving the Board committee at each stage was critical for a successful outcome.

Lesson four: Pay attention to the many issues beyond the terms of the partnership/merger agreement. A successful transaction requires much more than just the terms for institutional combination. Understanding the culture of each institution and planning for how these can fit together may not seem as important as the terms of the deal, but lack of attention to this can lead to a failed transaction. Equally important is communication, keeping all relevant stakeholders informed. It is never too early to begin communicating. Lack of communication will generate speculation and stories, which in turn may lead to fear and trouble. Don’t forget about regulators (Federal, state, and perhaps local) and accreditors; all need to be informed and brought into the process in a timely manner.

We will say more about each of these lessons in future posts. For now, and in summary, institutional partnerships and mergers are becoming increasingly common and important in higher education. The results of any partnership or merger will be much more favorable to an institution that approaches the transaction from a position of strength. These transactions are not something most higher ed institutions have experience with. They are complex – and expensive – processes, and having an experienced agent to guide your institution through the process vastly improves the likelihood of success.