Medaille University says acquisition is off, raising concerns about its future

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Dive Brief: 

• Trocaire College is no longer planning to acquire Medaille University, canceling a planned consolidation between the two private institutions in Buffalo, New York, according to an announcement Thursday. 
• In a statement, Medaille Interim President Lori Quigley said the two institutions could not “disclose specific details of the termination,” citing confidential legal and business matters. 
• The collapse of the acquisition raises serious questions about the viability of Medaille, which has been hemorrhaging students, laying off employees and facing a warning from its accreditor. 

Dive Insight: 

News that the acquisition has collapsed comes just over a month after it was announced. At the time, Medaille said that being absorbed by Trocaire, which is just 9 miles away, would help both institutions withstand declines in regional enrollment. 

When announcing the consolidation in April, Quigley said the coronavirus pandemic exacerbated existing enrollment troubles that were brought about by declining birth rates in Western New York. Indeed, Medaille struggled during the health crisis, cutting employees and stripping away tenure protections. 

Both colleges have seen their enrollment plummet over the past decade. Medaille’s headcount fell from nearly 2,600 students in fall 2012 to around 1,800 students in fall 2021, representing an enrollment decline of 29.9%. Trocaire’s enrollment likewise declined 27.7% over the period, with the college counting 1,100 students in fall 2021. 

Although Trocaire has lower enrollment than Medaille, the college has a healthier endowment. Trocaire’s endowment was worth $22.5 million at the beginning of fiscal 2021, while Medaille’s was worth around $2 million, according to federal data. 

In a statement Thursday, Trocaire President Bassam Deeb expressed dismay with the called-off acquisition, noting that both colleges had invested significant time and money into exploring the consolidation. 

“While this is an extremely disappointing announcement, it was a goal worth pursuing,” Deeb said. 

Medaille announced a Friday trustee board meeting to discuss the university’s next steps. However, recent examples of failed mergers raise concerns about the private college’s future. 

In July, the 151-year-old San Francisco Art Institute said it would no longer operate as a college after its plan to be absorbed by the University of San Francisco fell through. The university’s leaders said “several critical issues emerged” that scuttled the deal, including the art institute’s poor finances and enrollment projections. 

Only a few months prior, Marymount California University said it was shutting down after a planned merger with Saint Leo University, a fellow Catholic institution, collapsed. The announcement came shortly after Saint Leo’s accreditor declined to sign off on the deal over concerns about the university’s budgeting, dashing hopes for the colleges to combine.