Merger watch – February 2025
Siân Champkin, a partner at law firm VWV, reviews merger activity over the past 12 months
In my first Merger watch of the year, and marking a year since the inaugural one, I look back on a very busy 2024 for transactions, and also look forward to what 2025 may hold for the independent schools sector.
Key facts: look back at 2024
There were 71 completed or ongoing K12 independent schools transactions of which:
- 20 sell-side,
- 13 buy-side,
- 29 merger,
- 9 other structure, and
- 9 had an international element.
Some transaction highlights:
| Client | Project | Sell-side/Buy-side/Merger |
| Abbott’s Hill School | Merger with Mill Hill School | Merger |
| Ardingly College | Merger with Great Walstead | Merger |
| Ardingly College | Acquisition of Ardingly Activity Centre | Buy-side |
| Derby Grammar School | Sale to Inspired Learning Group | Sell-side |
| Finborough School | Sale to Forfar Education | Sell-side |
| Forfar Education | Acquisition of St Helen’s College | Buy-side |
| Micklefield School | Merger with Reigate Grammar | Merger |
| Redmaids’ High School | Merger with GDST | Merger |
| Ruthin Education Limited | Acquisition of Durham High School for Girls | Buy-side |
| Ruthin Education Limited | Acquisition of Malvern St. James Girls School | Buy-side |
| Sevenoaks School | Merger with Solefields School | Merger |
| Sherborne School for Girls | Merger with Sherborne School | Merger |
| St Alban’s High School for Girls | Merger with Stormont School | Merger |
| St Dunstan’s College | Merger with Christopher Hall School | Merger |
| Stowe School | Merger with Ashfold School | Merger |
| 39 other ongoing or confidential projects | ||
| 10 aborted transactions (confidential) |
As anticipated, a substantial portion of these transactions involved mergers between charitable organisations, which remain the most common type of transaction we advise on. However, there was also a noteworthy number of deals involving commercial acquisitions or sales, which featured one party as a charity and the other as a commercial entity. This development highlights an interesting and ongoing trend of increasing collaboration and interaction across various segments of the sector, be that with the charity school as seller or indeed buyer.
The year ahead
Of course, it will come as no surprise that 2025 looks set (and is already proving) to be busier still for transactions and will be strategically critical for all independent schools as the sector responds to the government’s changes to VAT, business rates, National Insurance/Minimum Wage and also demographic challenges.
The cumulative effect of these headwinds will arguably lead to falling enrolment in the sector. Of course, the impact on a particular school is highly nuanced by year group, geography and indeed a school’s relative strength in the market and own parent body.
As predicted senior schools acquiring prep schools in charity-to-charity mergers are very busy with schools such as Sevenoaks embarking on its ‘family of schools’ strategy with the merger with Solefield School in Sevenoaks.
Building on the 2024 trend, there’s likely to be a continued growth in the number of sales of charitable schools to commercial operators/groups including those being undertaken by Galaxy Education (formally Ruthin Education) which has grown its group from one school to three.
More commercial acquisitions by charitable schools are also expected such as the one undertaken by Ardingly College of Ardingly Activity Centre serving as a good example of diversification away from school fee income.
There’s also a growing trend in the acquisition of early years settings, coupled with a resurgence of interest in international strategic initiatives. These shifts reflect schools’ efforts to broaden their scope and lessen dependence on fee income. So interesting times ahead as we remain poised for a very busy and interesting 2025.
Siân Champkin