Is Keio-Kyoritsu merger a sign of things to come?

The wave of business reorganization has enveloped even private universities. The phenomenon may be a sign of the changing circumstances surrounding universities, which have been hard pressed by the declining birthrate.

Keio University and Kyoritsu University of Pharmacy have agreed to begin formal discussions on merging. Under a merger, Keio University would set up a faculty of pharmacy in the university and a pharmacy graduate course at its graduate school in the 2008 academic year.

Kyoritsu suggested the merger plan to Keio. Kyoritsu changed the four-year course in its pharmacy faculty to a six-year course in the 2006 academic year. The number of applicants for the entrance examination this spring fell by 14 percent from the previous year.

In addition, students are required to train at hospitals for a longer period with the extension of the course by two years, meaning that Kyoritsu had to find hospitals to accept its students. It was two years ago that Kyoritsu broached the idea of a merger with Keio, which has one of the most famous university hospitals, Kyoritsu said.

A pharmacy faculty would be added to Keio, which already has a school of medicine and a faculty of nursing and medical care. With the merger, it would be possible for Keio to offer students the latest on-the-job training in team medical treatment in cooperation with doctors, pharmacists and nurses. Keio likely accepted the merger plan because it judged that it would be able to polish the brand image of the university by establishing the new faculty.

Both universities seem to have seen synergistic benefits in the tie-up.
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Colleges must adapt or die

There have been no mergers between four-year private universities for more than 50 years. State-run universities were reorganized and integrated to strengthen their business bases and systems for education and research before they were turned into independent administrative entities in 2004. Yamanashi University merged with Yamanashi Medical College, for example, and Tokyo University of Mercantile Marine merged with Tokyo University of Fisheries. As a result, the number of national universities shrank from 100 to 87.

Private universities have been reluctant to merge because it is difficult for them to find a suitable partner in terms of academic history and culture, the standards for grading entrance examinations and site locations. Also, there are many university administrations who do not want to see the names of their universities disappear after merging.

However, they must adapt to deal with the declining birthrate. The number of entrants into universities and colleges peaked at 810,000 in 1993 and dropped to 690,000 in 2006. Nevertheless, the number of private universities has risen to 568, 30 percent up on the 1996 figure.
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Demand to meet supply

According to the Promotion and Mutual Aid Corporation for Private Schools of Japan, 40 percent of private universities did not meet their intake quotas after the entrance exams this spring. This was shocking news because the figure rose 10 percent from the previous year.

In local areas, some private universities went bankrupt. We should avoid by all means a situation in which young people are deprived of the opportunity to study.

The current situation has also affected famous private universities in urban areas. Some have responded to the challenge of the changing times by establishing new, attractive faculties and departments. Kwansei Gakuin University and Seiwa College, both based in Nishinomiya, Hyogo Prefecture, have been holding negotiation to merge in April 2009.

For the next academic year, the number of university applicants will match the number of places available. It is possible that the merger decision by Keio and Kyoritsu will prompt the administrations of many other private universities to explore merger opportunities.
(From The Yomiuri Shimbun, Nov. 22, 2006)
(Nov. 22, 2006)

http://www.yomiuri.co.jp/dy/editorial/20061122TDY04006.htm