Keystone Insights Blog
Expert advice and strategies for academic success and personal growth.
How Independent Due Diligence Helped Esteem MAT Make the Right Strategic Decision
When Esteem Multi-Academy Trust was approached about acquiring an independent provider specialising in one-to-one tuition for young people at risk of exclusion, many of whom had Education, Health and Care Plans (EHCPs), the proposal appeared to fit well with the Trust's
long-term ambitions.
As this was the Trust's first acquisition of this nature, trustees wanted independent evidence that the opportunity represented the right strategic decision and the best use of public funds.
long-term ambitions.
The organisation's specialist expertise offered the potential to complement and strengthen the Trust's existing alternative provision and broaden the support available to vulnerable learners across the region.
As this was the Trust's first acquisition of this nature, trustees wanted independent evidence that the opportunity represented the right strategic decision and the best use of public funds.
Keystone was commissioned to carry out an independent due diligence review.
About Esteem Multi-Academy Trust
Esteem Multi-Academy Trust is a specialist trust for SEND and alternative provision, supporting vulnerable children and young people across the East Midlands.
The Trust exists to improve life chances by strengthening the quality, consistency and sustainability of its academies. Alongside delivering high-quality education, it has a clear ambition to expand specialist SEND and alternative provision, share expertise across the wider education system and ensure every strategic decision supports its long-term vision.
At the time of the review, the Trust was exploring opportunities to expand its specialist provision while ensuring every strategic decision remained aligned with its vision, values and responsibility to secure value for money.
The Challenge
As this was the Trust's first potential acquisition of this nature, trustees wanted independent evidence before deciding whether to proceed.
Although the opportunity appeared to align with the Trust's strategic ambitions, they needed to understand whether it represented value for money, was financially sustainable and offered the strongest long-term route to achieving the Trust's objectives.
Just as importantly, they wanted to compare acquisition against alternative options, including whether developing similar provision within the Trust could deliver the same strategic outcomes.
As custodians of public funds, trustees needed confidence that any decision could be supported by robust evidence and stand up to scrutiny.
Although the opportunity appeared to align with the Trust's strategic ambitions, they needed to understand whether it represented value for money, was financially sustainable and offered the strongest long-term route to achieving the Trust's objectives.
Just as importantly, they wanted to compare acquisition against alternative options, including whether developing similar provision within the Trust could deliver the same strategic outcomes.
As custodians of public funds, trustees needed confidence that any decision could be supported by robust evidence and stand up to scrutiny.
The Solution
Keystone carried out a comprehensive due diligence review covering the financial, operational, governance and regulatory aspects of the proposed acquisition.
Rather than reviewing the organisation as a standalone business, the assessment considered the opportunity through the perspective of an academy trust. It examined how it would perform as part of the Trust over the long term.
The review explored financial sustainability, governance arrangements, operational delivery, staffing resilience, contracts, commissioning arrangements, premises, lease obligations, regulatory compliance and future growth potential.
Rather than reviewing the organisation as a standalone business, the assessment considered the opportunity through the perspective of an academy trust. It examined how it would perform as part of the Trust over the long term.
The review explored financial sustainability, governance arrangements, operational delivery, staffing resilience, contracts, commissioning arrangements, premises, lease obligations, regulatory compliance and future growth potential.
Importantly, it challenged assumptions.
The review enabled trustees to move beyond the headline opportunity and understand both the potential benefits and the practical realities of the acquisition.
- Could the organisation remain sustainable under new ownership?
- How resilient were referral and commissioning arrangements?
- Did the proposed purchase price reflect the organisation's underlying performance and long-term value?
- Would the investment genuinely strengthen the Trust over the long term?
- Most importantly, was acquisition the best way to achieve the Trust's strategic ambitions?
"The review challenged our thinking, highlighted areas requiring further consideration and helped trustees understand the full implications of the proposal."
by Author
The Results
The review identified a committed organisation delivering valuable support for vulnerable children and young people.
It also brought much greater clarity to several strategic and operational considerations that only became fully apparent through independent scrutiny.These included leadership succession, workforce sustainability, premises arrangements, reliance on referral relationships, commissioner confidence, elements of the operating structure and the future investment required to support sustainable growth.
While the Trust had already recognised some of these issues, the due diligence process helped trustees understand their scale, how they interacted and the impact they could have on the organisation's long-term strategy.
The review also highlighted several risks that, although manageable individually, would have required significant investment and organisational change over time.
Perhaps most importantly, the review enabled trustees to compare the acquisition against alternative strategic options, including whether developing similar provision within the Trust would provide a better long-term outcome. As a result, the conversation shifted from whether
the Trust could acquire the organisation to whether it should. That distinction proved critical and, following completion of the review, trustees decided not to proceed.
Rather than viewing this as a missed opportunity, trustees were able to make the decision knowing it was supported by robust independent evidence and aligned with the Trust's long-term strategy.
Sometimes the value of due diligence isn't confirming a deal should happen. It's giving trustees the confidence to walk away when it shouldn't.
Key Outcomes
- Independent evidence to support trustee decision-making.
- Greater visibility of financial, operational and governance risks.
- A clearer understanding of the scale, impact and interdependencies of key risks.
- Confidence to compare acquisition against alternative strategic options.
- Assurance that public funds were protected through robust independent due diligence.
- Confidence that the Trust's long-term strategy remained aligned with its vision, values and commitment to improving outcomes for children and young people.
Thinking about an acquisition or major strategic decision?
Whether a trust is considering an acquisition, expanding provision or reviewing a major strategic decision, independent due diligence provides confidence that decisions are based on evidence rather than assumptions.
Keystone supports academy trusts with:- Independent due diligence for acquisitions and mergers
- Financial and strategic option appraisals
- Governance and risk reviews
- Business case development and challenge
- Interim CFO support and strategic financial advice
In this case, the process reinforced the value of disciplined governance and ensured the Trust made a well-informed decision that aligned with both its strategic priorities and its responsibility to secure value for money.
Client Feedback
"The due diligence process was fundamental to the quality of our decision-making. Ultimately, the Trust decided not to proceed with the acquisition, and we were able to make that decision with confidence because it was informed by independent evidence rather than assumptions or goodwill alone."
by Author
"The review challenged our thinking, highlighted areas requiring further consideration and helped trustees understand the full implications of the proposal. Just as importantly, it provided assurance that walking away was a positive strategic decision rather than a missed opportunity."
by Author
"For any trust considering a similar opportunity, I would recommend investing in independent due diligence early. Acquisitions can appear attractive because of strategic alignment, reputation or perceived growth potential, but trustees have a responsibility to test those assumptions rigorously. Independent scrutiny provides the information and confidence needed to make decisions in the best interests of pupils, taxpayers and the organisation's long-term sustainability."
by Author
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