Members of the Irish Management Institute will next week vote on a proposed €20 million merger with University College Cork that aims to secure the institute's future and buttress UCC's business education offering.
The institute, which is chaired by former IDA Ireland chief executive Seán Dorgan, and UCC have agreed the terms of the merger, six years after a previous attempt failed because of the institute's pension deficit.
The two colleges have been involved in a broad-based strategic alliance since 2011, but the proposal on the table now is for the institute to become a wholly-owned subsidiary of UCC.
The Irish Management Institute, which has more than 360 members and counts some of the most senior members of corporate Ireland as directors, has issued a circular to members ahead of an extraordinary general meeting to approve the deal on October 28th.
In the circular, Mr Dorgan urges members to back the deal, which will see UCC discharge all of the institute’s debts while allowing it to continue to operate as a commercially-run entity, but under the ownership of UCC.
It is envisaged that the institute and Cork University Business School will work closely together and “compete on the international stage”, the circular says.
The institute will continue to operate as a membership driven organisation, although its members will not own any shares. They will not be paid for the transfer of ownership to UCC.
Continued operations
It will continue to operate under an 11-person board, which currently includes head of Eir’s wholesale division Carolan Lennon and former managing partner of
KPMG
Terence O’Rourke. UCC will nominate six members of the board following the merger.
As part of the deal, the circular states, UCC will help the institute “discharge” its debts and pension obligations. It is understood this will involve an investment by UCC of about €20 million, which includes funding required to upgrade the institute’s facilities.
Ownership of the institute’s Sandyford campus will effectively transfer to UCC following the deal. However, all of its assets and operations will continue to be administered by the institute.
The Irish Management Institute has restructured its operations and governance in recent years, following a difficult period during the crash when its income plummeted. Its most recent published accounts, for 2014, show income of almost €11 million and profits of €550,000.
The accounts show bank loans secured on its property of €7.7 million and another charge of €7 million to its now-closed pension scheme.
The institute confirmed the egm would be taking place, while UCC said “business education at UCC will be strengthened by the merger”.
