Hamish Martin, a partner at LAVA Advisory Partners, explains why traditional M&A frameworks don’t cut it in independent education

Most M&A processes are designed with broad applicability in mind. They’re built to streamline tasks, de-risk deals, and identify synergies in the simplest way for the structure of most advisory firms. While this approach might work across some sectors, there are others where one size just doesn’t fit all, and the independent education sector is one of them.

Education is a sector that thrives on nuance. Independent schools are complex organisations that can be part business, part community, and often part charity too, with all the complexity that suggests. So when it comes to M&A in this sector, a standard playbook can easily miss the mark if it’s not tailored to the realities of the market.

One of the most significant factors that sets independent schools apart is the mix of stakeholders and their varying expectations. It’s not just dealing with balance sheets and governors or shareholders, but with parents, pupils, staff, alumni, buildings, and local communities, and at the heart of it all, a deep sense of identity and purpose. Schools are not interchangeable assets. Each one has its own ethos, culture and values, often built over decades or even centuries, and preserving that intangible value is critical for any deal to succeed.

Demand isn’t just about location

In more typical M&A models where property is a factor, location and real estate value often drive the conversation, but in education, pupil recruitment trends and local demand tell a more important story. It’s not enough for a school to be in a desirable postcode; it needs to be offering something parents actually want, and at a price point they’re willing and able to pay.

The market has seen instances where beautiful campuses with top-notch facilities struggle to attract pupils simply because the local market is saturated, or because demographics are shifting away from their particular offering. Conversely, a modest school in a growing commuter town with the right reputation and solid results can be an incredibly attractive prospect.

This means that when assessing viability, it’s vital to look beyond the bricks and mortar. Understanding patterns in pupil applications, competition from nearby schools (both state and private), and even things like transport links and feeder school relationships can all be deal-shaping factors.

The power of communication

Another pitfall of a more standardised approach is underestimating the emotional reaction to a deal. For staff, parents and pupils, the announcement of a merger or acquisition can easily trigger concern about job security, fees, or whether the ethos of the school will be preserved.

This is where a carefully managed communications strategy becomes essential. Getting the messaging right and getting it out at the right time can make all the difference to retaining trust and goodwill. Tone, timing and transparency matter hugely here. It isn’t possible to discuss it while a deal is still in the works due to strict confidentiality requirements and the risk of leaks in a standardised process, so it’s key to ensure the messaging is articulate, accessible, and approved by the relevant stakeholders, ready to release the moment completion takes place.

Communicating clearly, coherently and transparently as soon as you possibly can ensures stakeholders feel a part of the journey rather than blindsided by a local news item. Similarly, this is not the time for jargon-heavy statements about cost synergies, or other overly corporate language. Parents want reassurance, staff want clarity, and pupils (especially older ones) want honesty. Respecting the intelligence and emotional investment of these groups is the best way to earn – and keep – their confidence.

A shift in the VAT landscape

Of course, not every deal is driven by ambition. Many independent schools today are facing real financial strain, and in some cases, selling is the only viable option. Historically, this has come with a reputational burden as no one wants to be seen as ‘selling out’, especially when the school has charitable roots.

However, recent changes could be subtly shifting that narrative. With the government applying VAT to school fees, the financial models of many institutions are coming under new pressure. For struggling schools, the idea of joining a larger group or merging with a more stable partner starts to look less like failure, and more like pragmatism.

Parents are increasingly aware of the broader economic realities facing schools, and provided the deal is positioned with sensitivity and a clear focus on continuity of education and care, it can be seen as a proactive step to protect the school’s future and legacy.

A unique proposition

M&A in the independent education sector requires more than just a standard approach. As well as top-notch technical expertise, it demands emotional intelligence, cultural awareness, and an appreciation of what education really means to those who deliver and receive it. A tailored, sector-specific approach isn’t just preferable, but essential to delivering deals that provide real value for everyone involved.

Hamish Martin