Why Strategic Buyers Are Quietly Winning Private School M&A in 2026
I have been advising owners of private schools through good markets and hard ones for more than 40 years, and 2026 is shaping up to be one of the more interesting markets I have seen. Deal volume across education is down. Financial buyers are sitting on the sidelines. And yet strategic buyers, the operators already running schools who want to grow through acquisition, are still closing deals and in some cases paying up to do it.
If you own a school and you are wondering whether now is the right time to explore a sale, understanding who is actually buying matters more than the headlines about a slow market.
At a glance
- Overall education M&A activity fell roughly 20 percent year over year through 2025 and into 2026, with strategic tuck-in acquisitions the only segment to hold steady.
- Private equity buyers face constrained debt financing, and many are fully sidelined heading into the back half of 2026
- Strategic buyers, including large school groups and platform operators, are actively acquiring to fill gaps in their networks.
- Recent deals show strategics paying premium prices for the right assets, even in a soft overall market.
Why Has Private Education M&A Slowed Down in 2026?
The slowdown traces back to a valuation disconnect that built up over the past few years. Many education assets changed hands at peak pricing during and just after the pandemic. The buyers who paid those prices are now reluctant to sell at today's more realistic valuations, since doing so means realizing a loss. That standoff has kept a lot of inventory off the market and reduced overall deal counts.
At the same time, financing has gotten harder to secure. Private equity firms typically rely on debt to fund acquisitions, and tighter credit conditions have pushed many of these buyers to the sidelines entirely. The result is a market where deal volume looks weak on paper, but where activity has not actually disappeared. It has shifted toward a different type of buyer.
Why Are Strategic Buyers Still Closing Deals When Financial Buyers Are Sidelined?
Strategic buyers do not rely on the same financing structures that private equity firms use, and they do not judge a deal purely on financial engineering. A strategic buyer already operates schools and is looking at an acquisition through the lens of network fit, geographic expansion, and program strength. That is a fundamentally different calculation than the one a leveraged financial buyer makes.
We have seen this play out in real transactions this year. A large international school platform completed a multi-billion-dollar take-private with a new investor group, expanding its long-term capital base for further acquisitions. Established early childhood platforms have continued to acquire smaller providers to add enrollment capacity in target markets. Advisory-led sales of individual international schools to strategic acquirers have continued to close even as broader deal counts have fallen. None of these buyers needed the debt markets to cooperate. They needed the right school, in the right location, with the right fit.
This is consistent with something I always tell owners when we talk through the five buyer types who actually purchase private schools. Strategic buyers have always been willing to pay more than financial buyers for the right asset, because they are buying growth and market position, not just cash flow. In a market where financial buyers have largely stepped back, that gap in what strategics are willing to pay becomes even more pronounced.
What Does This Mean If You Are Thinking About Selling Your School?
If your school fits what a strategic buyer wants, meaning strong enrollment, a defensible market position, and a program that complements an existing network, this market can work in your favour even while the broader deal count looks soft. Strategic buyers are not waiting for interest rates to move or debt markets to loosen. They are buying now for reasons unrelated to financing conditions.
The valuation mechanics have not changed just because the buyer pool has narrowed. The formula buyers actually use still applies, and understanding where your school sits within that formula tells you how attractive you are to the buyers who are actually active right now.
Owners who assume the whole market is frozen sometimes hold off on exploring a sale when, in fact, the right buyer for their specific school may be one of the market's most active participants today.
How Should Owners Prepare for a Market Led By Strategic Buyers?
Strategic buyers evaluate acquisitions differently than financial buyers, so preparation looks different too. They care deeply about how well your school's brand, curriculum, and management team will integrate into their existing network. They look hard at whether the school can run without excessive dependence on the current owner, since that affects how smoothly an integration goes after closing.
Getting a school ready for this kind of buyer means documenting your systems, strengthening your management bench, and clearly articulating what makes your school a fit for a larger network. It also means moving quickly and staying disciplined once a deal is in motion. I have seen too many transactions unravel in the 90 days after the letter of intent because the seller was not prepared for the level of scrutiny a strategic buyer brings during due diligence.
Frequently Asked Questions
Are strategic buyers paying more than private equity right now?
In many cases, yes. Strategic buyers are less dependent on debt financing and evaluate deals based on network fit and growth potential, which often leads them to pay more than financial buyers operating under tighter leverage constraints.
Does a slow overall M&A market mean I should wait to sell?
Not necessarily. Overall deal counts reflect a lot of frozen private equity activity. If your school is the type of asset a strategic buyer wants, this market may actually work in your favour.
What specifically makes a school attractive to a strategic buyer?
Strong enrollment, a defensible market position, a program or geography that fills a gap in the buyer's existing network, and a management team capable of operating independently of the current owner.
How is this market different from 2021 or 2022?
Valuations have come down from pandemic-era peaks, financing is tighter, and financial buyers have pulled back significantly. Strategic buyers have become the dominant force in transactions that are still closing.
If you are wondering whether your school fits what today's active buyers are looking for, I am glad to talk it through with you.
Contact Halladay Education Group
Email: info@halladayeducationgroup.com
Phone: 1.800.687.1492