The ifs and buts of a potential takeover

Finance school's vice-principal is keener on a level playing field than private suitors, John Morgan hears

April 12, 2012

The vice-principal of the ifs School of Finance has conceded that the charitable institution "could become a target" for firms seeking to buy degree-awarding powers as speculation mounts about takeover bids.

The institution, which gained degree-awarding powers in 2010 and is one of only five private providers granted the coveted status by the Privy Council, rejects the suggestion that it has explored a sale to potential for-profit bidders.

But the number of private institutions that possess degree-awarding powers and are open to a buyout has shrunk: BPP was bought by the US for-profit Apollo Global for £368 million in 2010, and the charitable College of Law is in talks with Montagu Private Equity.

Any takeover of the ifs School of Finance could follow the model likely to be used in the College of Law sale, which would involve the charity being separated from the college and the latter becoming a for-profit institution.

Aldwyn Cooper, chief executive and principal of private, charitable Regent's College, said: "I would be stunned if the ifs had not been approached...They are an obvious target, and quite likely some of the big players who don't have their own degree-awarding powers are going to make some sort of bid for them."

Martin Day, ifs vice-principal, told Times Higher Education: "There's always the possibility that the ifs could become a target, but there's nothing we could do about that. We're a charity, we've been around for 130 years: that's where we are."

Mr Day said he hoped that a higher education bill - which has been shelved for now - would level the playing field between state-funded and non-state-funded institutions.

He cited the disparity between universities, which hold their degree-awarding powers in perpetuity, and non-state-funded institutions, which must reapply every six years. This hinders the ifs' ability to plan long term and its capacity to "be able to expand [and] offer new programmes within our specific remit, which is financial services", Mr Day said.

He also singled out the different caps on state-funded student loans: students at universities may draw up to £9,000 in 2012-13, but those at non-state-funded providers may access a maximum of only £6,000.

"We're not seeking to go up to that [£9,000] level by any means, but it's just not quite right, perhaps, that there's a different treatment," Mr Day said.

The ifs offers two undergraduate courses whose students are eligible for support from the publicly subsidised Student Loans Company.

Under the proposed higher education bill, private providers whose students access loans would have come under the undergraduate number controls that apply to most universities.

"You could say that's nice because we have no caps," Mr Day said. "But if there are going to be caps, we would like to know what they will be so we can...plan for them. In the absence of anything, there's uncertainty."

He added: "I can't really see any reason why we shouldn't be treated in the same way - in terms of quality control and student access to funding through the Student Loans Company and requirements for Offa [the Office for Fair Access] - in the same way as any other HE provider."

john.morgan@tsleducation.com.

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