Vivienne Stern, from Universities UK, said the merger was significant, and a sign of how universities were thinking differently.
She said the “slow erosion” of university finances needed to be stopped and the government “was needed on the pitch pretty fast” with longer-term solutions.
Those government plans for the future funding of universities in England are expected later this autumn.
Ministers have already said they are looking at applying a 6% tax on income from international students.
A DfE spokesperson said: “This collaboration shows how strong partnerships in higher education can help enable delivery of world-class teaching and research whilst maintaining the best interests of students.”
Any change on this scale has to be overseen by the OfS, which regulates universities in England, and makes sure students’ studies are not disrupted.
“In any merger, effective communication with students will be crucial,” a spokesperson said.
“Current students will continue to study for the courses they signed up for, and should continue to expect excellent teaching and support.”