Charity: mergers, alliances and joint ventures

Charities often join forces, by entering into partnerships, joint ventures and via full mergers for a number of strategic and operational reasons.

For instance, by pooling resources and capabilities the charities joining together will be in a better position to compete for and secure larger contacts and funding merger

By amalgamating back office and administrative functions, there is opportunity to achieve greater financial and operational efficiency savings which in turn will lead to more funds being channelled towards the front line activities.

And quite simply, by creating an enlarged operation, either as permanent merger or as temporary alliance or joint venture to e.g. deliver a service contract on behalf of a local authority, the larger organisation is likely to provide service users with improved access and an expanded range of services/advice.

If you are considering a joining forces with another charity either on a temporary basis or permanently, we can help.

  • Option assessment – we will discuss your current situation, strategic objectives and the potential options – mergers, alliances, joint ventures, sub-contract etc that are available and which is most suitable for your charity.
  • Know your partner – we will undertake due diligence on your proposed partner and we will provide you with a report which covers the key strategic, financial, risk management, people and governance matters. We will provide you with a full dossier and our experience assessments so that you know exactly who you are thinking about working with warts and all.
  • How should the venture be structured – again there are different options available to you and will depend on a number of issues, for instance, has there to be lead partner, who will make up the board – equal numbers from all sides, how will the alliance/merger be constituted, creation of group structure and subsidiaries
  • Tax – there could be potential tax charges that arise from joining together with another charity. We will ensure you know exactly what liabilities could arise and if there ways to reduce or remove the liability we will make you aware of what needs to be done.
  • Reporting and administration – we will ensure that you stay on the right side of the law and report your intentions and actions to OSCR as appropriate.