The pace of activity to carry out a college merger or acquisition (M&A) can be intense and time-consuming. These processes require key players to ask the right questions and compile the correct data to give the M&A effort its best chance of success. Failure to collect the right data and ask the right questions can doom M&A work to failure.
Michael J. Marquardt and Bob Tiede, authors of the book Leading with Questions, suggest that questions “can be very powerful in focusing attention.”1 They continue to explain that these questions can empower or disempower institutions. In higher education M&A work, it’s important to keep the effort focused on empowerment since there are typically forces on the negative side that work to derail M&A discussions for various reasons.
M&A questions tend to fall into three categories:
- Internal readiness
- Target or partner desirability
- Transaction evaluation
A fourth area of questions deals with the many tasks that need to take place and how those tasks will be arranged and completed. However, that will be addressed later.
When considering if the merger and merger partner are ideal, we encourage higher ed professionals to ask the following questions:
Category One: Internal Readiness
- What is our state of readiness and sense of urgency around the M&A idea?
- What does our financial state tell us about our level of readiness?
- How does our M&A plan fit into the competitive landscape?
- When finished, how will this M&A work enhance our mission?
- What does the market and competitive landscape suggest as we pursue our target partner?
These questions are crucial, as they help leaders understand the context in which they are working. In turn, the data that these leaders collect on their merger target may be more relevant.
Category Two: Target Desirability
- Does our partnership with this target align with the current assessment of local workforce and marketplace needs?
- What physical facilities does our target contribute to the M&A activity to further support high-quality academic and co-curricular programs?
- What advantages might our target partner bring (in the following areas)?
- Legal
- Big tech integration
- Regulatory/accreditation
- Facilities
- Communications
- Financial
- Strategic objectives identified during the strategy phase
- Cultural fit (values and ideologies)
- Mission fit
- Vision fit
- Presence of complementary resources and programs
- Have we conducted a culture compatibility analysis, and what does it tell us about the potential merger or acquisition partner?
Category Three: Transaction Evaluation
- What key performance indicators (KPIs) will we use to determine the level of success of this M&A effort?
- How will the addition of our target partner enhance the KPIs?
Closing Thoughts for Your M&A Checklist
Empowering your M&A team with the right questions and adequate resources about target partner data can help produce a successful merger or acquisition result.
Fortunately, our team at Forvis Mazars has extensive experience serving more than 300 colleges and universities across the U.S.—from small, private colleges to large, public universities. With a global breadth of resources and local depth of industry knowledge, we can support your merger, acquisition, or strategic partnership from beginning to end.
By combining the industry-specific experience of our Higher Education Consulting team with the extensive major transaction knowledge of our Higher Ed Mergers, Acquisitions, & Other Strategic Partnerships Services Team, we offer a full suite of services to usher institutions throughout the merger or acquisition process.
For more information, please reach out to a professional at Forvis Mazars.
- 1 Michael J. Marquardt and Bob Tiede, “Leading With Questions: How Leaders Discover Powerful Answers By Knowing How and What to Ask,” Third Ed., Wiley, 2023 (pg. 69–73).