Are You Considering a Merger of Your Multi Academy Trust?

The drivers for the merger can be wide ranging although they largely fall into the following categories:

• One of the MATs is facing intervention from the regulator (through the Regional Schools Commissioner or 'RSC') on account of a MAT's performance in its Ofsted inspection or because of a failing around governance or finance.
• The CEO of one of the MATs is coming up to retirement and there aren't obvious succession plans in place.
• Simply, the two MATs share a common vision and ethos and there are clear educational and/or financial merits in the schools being operated within one MAT.

In the early stages, we recommend putting in place:

• a Confidentiality Agreement (sometimes referred to as a non-disclosure agreement or 'NDA') to ensure the control of confidential information and also to control external communications in respect of the merger, and
• a non legally binding Memorandum of Understanding through which the parties to seek to agree a set of principles for the proposed merger and the merged MAT

At this point, it is usual to determine the proposed mechanism for the merger - ie which MAT will transfer its academies into the other. In these circumstances where there is a merger of equals, it is possible to create the optics of a 'new' MAT, rather than to draw attention to one party being the 'acquirer' or the 'disposer' - which is essentially just the legal mechanism of bringing the academies all together. The merged MAT can then be launched.

The staff at the Transferring Academies (and ordinarily the central team at the transferring MAT), will transfer to the other MAT under the TUPE Regulations. As is the case on conversion to academy status, specified information needs to be provided to the recognised trade unions in respect of the proposed transfers. In the event of 'measures' (ie changes to terms and conditions) being proposed, consultation will be required. A list of all transferring staff will also be required.

If any of the academies operated by the transferring MAT are designated with having religious character then the relevant religious authority (for eg the relevant Church of England diocese), will need to be consulted at an early stage. Their formal consent will necessarily be required for certain legal aspects.

Broadly, the legal process involves:

• stakeholder Consultation
• due diligence
• RSC approval
• preparation and completion of the legal transfer documentation to secure the transfer of the transferring Academies over to the merged MAT:
  • the transfer agreement
  • novation (ie transfer) of the funding agreements
  • the transfer of the land (which will require separate ESFA approval)
  • the novation of any grant agreements and construction documentation
• the transfer of staff (TUPE) 
• completion and launch date
• dissolution of the empty MAT

For further guidance on the step by step process, please access our guide to mergers on our Onstream portal.

For a no obligation chat to discuss your proposed merger, please contact Chloe Brunton on 07920 281889, or Jaime Hobday on 07467 220552, or complete the form below.