Choosing Your Path in Australian Higher Education: Initial Registration vs. Acquisition

Posted: 17/07/2024
by: Claire Holmes

When venturing into the higher education sector in Australia as either an Institute of Higher Education, University College, Australian University or Overseas University, a critical decision must be made whether to pursue initial registration as a new provider or to acquire an existing one. Each path presents unique challenges and benefits.

Choosing between the initial registration or acquiring an existing one involves balancing the flexibility and customisation of starting from scratch with the quicker market entry and existing infrastructure of an acquisition. Both require thorough due diligence and expert guidance to ensure success. DVE breaks down the key differences between the 2 options for consideration before making your decision.

Initial Registration of a Higher Education Provider

Compliance and Accreditation:

The initial registration process involves meeting stringent requirements set by the Tertiary Education Quality and Standards Agency (TEQSA) and development of comprehensive policies and procedures that align with national standards. Obtaining accreditation for courses is a rigorous process, requiring detailed documentation and evidence of quality and capacity.

Financial Considerations:

Financial stability and capital investment are critical considerations when thinking about initial registration. Significant upfront investment is required for infrastructure, staffing, curriculum development, and marketing. TEQSA requires evidence of financial viability and sustainability, including detailed financial projections and contingency plans.

Institutional Setup:

Infrastructure: Developing campus facilities, technology platforms, and administrative systems from the ground up.
Human Resources: Recruiting qualified academic and administrative staff to ensure high standards of education and management.

Key Considerations:

Time and Effort: The process is time-consuming and complex, often taking several years before students can be enrolled.
Flexibility: Starting anew allows for designing a tailored education model and institutional culture.

Acquisition of an Existing Higher Education Provider

Compliance and Accreditation:

Before a change of ownership or control of a registered Higher Education Provider (HEP) event takes place , TEQSA expects to be provided with notification in accordance with section 29(1)(a) of the TEQSA Act (for further detail, refer to TEQSA’s Material Change Notification Policy). TEQSA’s interest following a change in control or ownership of a HEP will focus primarily on potential risks to the quality of students’ educational experience, and a provider’s financial viability and sustainability.

Due Diligence:

Detailed due diligence helps identify potential risks and areas needing improvement. Conducting a thorough evaluation of the existing provider’s financial health, compliance history, reputation, and operational efficiency. Throughout legal and financial scrutiny should be undertaken by experts to ensure all legal documents, contracts, and financial records are in order. This includes understanding any liabilities or pending litigations.

Operational Transition:

The integration and merging of existing operations with a new mission and vision requires careful planning and management to maintain continuity and improve quality. A post-acquisition team can assist in leading the process. Further, ensuring that the organisation structure and vision for the organisation is communicated quickly to champion people will assist in ensuring success.

Key Considerations:

Quicker Market Entry: Acquisition allows for faster entry into the market with more immediate operational capabilities then that of an initial registration.
Existing Infrastructure: Leveraging established campuses, technology systems, and administrative processes.
Student Body and Staff: Inheriting an existing student base and experienced staff, reducing the lead time to operational stability.

Deciding between the initial registration of a higher education provider and acquiring an existing one depends on your strategic goals, financial capacity, and risk tolerance. Initial registration offers the opportunity to build a bespoke institution but requires significant time and resources. Acquisition provides quicker market entry but necessitates comprehensive due diligence to identify and mitigate risks. Engaging experts in the field ensures that you make informed decisions and set your institution on a path to success.

Specialists can help ensure that all regulatory and accreditation requirements are met efficiently. Financial experts should be engaged to provide insights into the economic viability of starting anew versus acquiring, ensuring that you are prepared for the financial demands of either path. Consultants with experience in higher education can guide the development or integration of administrative and academic systems, ensuring smooth operations.

If you would like further information about how DVE could assist your institution with your Initial Registration or Acquisition, please reach out to the DVE Business Solutions Team – we’re always happy to organise an Advisory Session or an informal chat to discuss how we can support you.