Ashridge Business School, one of just seven UK private providers with degree-awarding powers, has announced a potential merger with US business school Hult.
The link with non-profit Hult International Business School could in effect allow the US institution, which has a London campus, to use Ashridge’s degree-awarding powers.
Ashridge said in a statement that the two organisations “will be collaborating closely” in the short term, while “in the longer term, the aim is to merge the top management across the two organisations”.
Hult is reported to be making a £50 million investment as part of the deal. However, the statement said that under the “strategic alliance, Ashridge and Hult will remain for the foreseeable future as separate entities, with their own brands, programmes and management”.
Big, for-profit firms such as Pearson, Kaplan and Laureate are known to be interested in acquiring control of UK degree-awarding powers. A number of these are thought to have already shown an interest in Ashridge. An Ashridge spokesman said that there had been “discussions with a number of potential partners. But really it boiled down to Hult, because we are the right fit for one another.”
The business school is part of the The Ashridge (Bonar Law Memorial) Trust, which must preserve historic Ashridge House, Hertfordshire (where the business school is located) for the “benefit of the nation”.
The complexities of its charitable trust status may have deterred for-profit buyers, but the broader financial picture may also have been an issue. The trust’s last published set of accounts, for the year ending December 2012, state that it “generated an operating deficit of £665,000”, growing to £1,388,000 once a pension deficit was taken into account.
The governors “agreed a plan which justifies reasonable expectation that the trust will return to surplus in 2013”, the accounts add.
The performance of the Ashridge Pension Scheme meant the trust’s pension deficit increased from £23.8 million to £29.7 million in 2012, the accounts state. Group net assets fell from £6,957,000 to £608,000 in 2012, the accounts also show.