Forvis Mazars, a major accounting and consulting firm, has introduced the Higher Ed Strategic Partnership Hub, a confidential network designed to connect colleges and universities interested in strategic partnerships, including mergers and acquisitions. This initiative comes as the higher education sector faces significant financial distress, with 33 private, four-year college closures or mergers in 2024, compared to an annual average of 12 between 2016 and 2023. These challenges are driven by demographic shifts leading to lower enrollments and declining state and federal funding.
The Hub aims to facilitate conversations that leaders are already having in boardrooms but often struggle to initiate or structure. Rachel Pauletti, leader of the higher education consulting practice at Forvis Mazars, emphasized that successful partnerships in this space can take years to finalize, not months, highlighting the need for early engagement. The process begins with a survey to gauge interest in various partnership forms, from shared administrative functions to full mergers, followed by a complimentary session with the firm's consulting team and access to their Mergers & Acquisitions Playbook.
Participation in the Hub is free and carries no obligation to proceed with a partnership or engage Forvis Mazars' services. The firm's extensive experience, serving over 350 college and university clients and providing more audits to higher education institutions than any other firm, underpins the initiative. The goal is to empower institutions to take a strategic and intentional approach to partnerships, supporting their long-term viability in an increasingly uncertain landscape.
Separately, the US Department of Education under the Trump administration is also looking to accelerate college mergers and acquisitions by expediting and simplifying M&A reviews within the next year, a policy supported by many university leaders bloomberg.com. Under Secretary Nicholas Kent stated that the agency aims to streamline a process that can currently take years, as exemplified by Northeastern University's acquisition of Marymount Manhattan College, which is expected to finalize more than two years after its announcement newstribune.com. This move could also open doors for private equity firms to acquire struggling institutions bloomberg.com.
Many colleges are struggling with lower enrollment, federal funding cuts, and rising operational costs. A report by Huron found that 442 private colleges, over a quarter of the US total, are at risk of closure or serious financial downturn newstribune.com. Larger institutions are seizing opportunities to expand enrollment capacity and acquire valuable real estate, with some, like Northeastern University, gaining hundreds of millions of dollars in assets through acquisitions newstribune.com. While a quicker federal review won't guarantee approvals, it addresses the critical issue of time for institutions with short financial runways, as many simply don't have years to wait for regulatory processes to conclude newstribune.com.
