The King's contract was operated by a wing of the Defence Studies Department (which does the academic provision for the Staff College courses), rather than War Studies. When the specification for the latest iteration of the contract was put out, King's decided not to pursue their interest further (at least according to the email I got about it).
AIUI, couple of other universities expressed interest, but also chose not to bid, again because of certain aspects of the contract (no blame attached to any side - the RAF has certain outcomes it wants, and in the grand scheme of things, universities have similar desires, and if the two don't match up, then the Universities don't bid).
As CBtL suggests, the majority of the King's academics will simply become Portsmouth academics. The team includes a former Buccaneer nav and the new head of the department - if it's the person I've been told it is - is also ex-aircrew (Phantom & F3, if memory serves, but I honestly can't recall). You're not going to see people with fancy designer specs turning up and spouting business-speak unless either of them has been dropped on their head from a great height recently (and in the case of the ex-Bucc mate, that'd have had to be after 1230 today, when I last spoke with him...)
There is, in fact, a growing interest amongst the Russell Group universities in partnering with defence, but they have certain things that they feel they need to do to [business speak] operationalise their intended strategic outcomes for general development and the Research Evaluation Framework [\business speak] which means that some contracts won't attract a bid from them, even if there is initial interest.