NORTHERN College of Education, badly hit in the research assessment exercise and this year's funding round, is seeking a merger with Aberdeen and Dundee universities.
The college, which has campuses in both cities, is the last of Scotland's monotechnic teacher training colleges to seek a university alliance. Jordanhill and Craigie colleges have merged with Strathclyde and Paisley universities, while Moray House Institute of Education is negotiating with Edinburgh, and St Andrew's College is in talks with Glasgow.
Northern College was rated only one in the RAE, and its grant from the Scottish Higher Education Funding Council was slashed by more than 6 per cent to Pounds 5.7 million, the worst cut for any Scottish institution. Its board of governors has now decided to split the campuses and start merger talks with the two universities.
Principal David Adams said the college's mission was still the education of professional staff for teaching, community education and social work, supported by research and consultancy.
"In the light of the Dearing and Sutherland reports and changing structures in Scottish higher education, the college now wishes to develop these services within the structure of a multi-faculty university, and to preserve them in both Aberdeen and Dundee."
Aberdeen University principal C. Duncan Rice said a merger "could make sound educational and structural sense". Dundee principal Ian Graham-Bryce, said the proposed talks were "positive".
A spokeswoman for SHEFC said: "We look forward to meeting with the colleges and the other institutions. We are confident that all parties will want the proposals to secure high-quality provision of initial teacher training in the northeast of Scotland."