Facing financial hardships as a private university, Augustana University College in Camrose has inked a deal to merge into the University of Alberta.

Under the plan, finalized in July, the Alberta government will pay $12 million over three years to revamp and upgrade existing classroom, research and administrative space at the Augustana campus and $7 million in additional annual operating funds. The province is also providing $7 million to fund the merger process.

Combining the campuses will enable the U of A to extend its programs to a rural community.

The merger is expected to support more than 1,000 students seeking degree-completion opportunities and help meet the increasing demand for post-secondary education in rural Alberta.

Augustana's acting dean Roger Epp said the deal is significant as "the barriers to participation in post-secondary education are huge in rural Alberta."