Merger watch – June 2024

  • 28th June 2024

Law firm VWV’s partner Siân Champkin analyses the latest merger activity in the independent sector


The first few months of 2024 have proved a busy and interesting time in the education transactions world with a significant number of transactions being undertaken as predicted.

Prep school mergers (either by joining a group or senior school) remain a dominant feature and we have received a large number of new instructions which appear to suggest this will continue as prep schools look to secure their future as part of a larger organisation.

Smaller schools and preps have generally suffered most in terms of market share of enrolment. Further, they are more likely (with exceptions of course) to be disproportionately detrimentally affected by the proposed imposition of VAT on school fees, given not only their inability to absorb some VAT through schemes such as the Capital Goods Scheme, but also by their generally more price-sensitive parents and higher fee income reliance.

A number of our senior school clients are considering multiple acquisitions over a relatively short period of time which is indicative of the trend towards groups of schools (both charitable and for-profit) expanding further. We know from the data that senior schools absorbing prep schools is a proven as a positive and proactive strategy (which may have incidental defensive benefits). There are benefits of scale and expertise, proven increases of pupil feed into senior schools and much more, as illustrated below. Of course, careful management is required of parents, teachers and other stakeholders and the reputation of the senior school is critical.

© Cairneagle

The commercial groups remain active and we expect to see further penetration of the for-profit groups into the sector as they grow their market share. With an ever-decreasing availability of proprietorial schools to acquire, some commercial groups continue to explore charitable school opportunities. The schools joining those groups benefit from being part of a larger family of schools, both in terms of on-the-ground benefits, but also the financial security of being part of a larger group rather than operating on a stand-alone basis.

On this theme, and as mentioned in this article in the last issue (February), we are increasingly experiencing charitable governing boards exploring options from a position of strength rather than distress and taking a strategic decision to join a commercial group of schools. Those governing bodies have seen this as a route to ensure their thriving schools can do so in a market that many predict – for several reasons – will be increasingly challenging. One such recent example on which we advised was Rupert House School – a co-ed pre-prep and prep school in Henley-on-Thames – joining Wishford Education.

The governors realised that in order to deliver its development plan, the school needed greater access to capital, expertise and scale beyond the capabilities of a stand-alone charitable foundation. The governors therefore engaged with third party experts to conduct a strategic review of the school’s opportunities.

As a financially healthy school with an outstanding academic record and a strong brand, the governors received interest from numerous parties which has enabled it to choose the best partner to take Rupert House confidently forward into the future with the benefits of scale.

Charles Lowe, chair of governors commented: “We are delighted to have found a partner in Wishford who can fully realise our ambitions for Rupert House and that will enhance the already outstanding education we deliver to our pupils. They share our values and are keen to support and develop our close links with the wider Henley community. Wishford brings the scale, back-office expertise and financial clout that will see Rupert House looking forward to its next 100 years with confidence.”

Unfortunately, not all such scenarios end in success and we are seeing an increasing number of schools either selling at a point of distress or indeed being forced to close, sometimes with very little notice. This shows the critical importance of taking advice early and having clear strategic aims for the success of your school.

Some recent transaction completed in the early part of the year include:

Derby Grammar School: acquisition by Inspired Learning Group.

Rupert House School: acquisition by Wishford Schools Group.

Micklefield School: merger with Reigate Grammar School.


Siân Champkin


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