1. Legal structures for collaborations and mergers
David Saunders
David Kelly
NCVS

2. Association
Consortia
Collaboration
Alliance
Merger

3. Why collaborate? Funders Less money available Combat bigger threats
Convenience for commissioners

4. Combines the benefits of large and small scale
Rationalised area-wide structure, dovetailing independent service delivery responsive to local or specific client group needs

5. How do you do it? Look before you leap Find potential partners
Communicate throughout
Does it fit with trustees/vision/values/priorities?
Take advice
Agreement

6. Models
Separate organisations keep their independence but work jointly on some activities or functions
Organisations with resources/expertise offer assistance to others
New organisation is formed to do joint work on some activities (track record)
Group structure with lead organisation
Merger to form a new organisation, working as one on all activities

7. Type of activities
Can be used to carry out charitable activities, service delivery, campaigning or policy work
Share premises or functions
Improve strategic efficiency

8. What is a bidding consortium?
A group of organisations who come together to win contracts
Speculative
Longer term collaboration, set up in advance with a wide membership and wide areas of activity
Responsive
Shorter term collaboration, set up in response to a particular opportunity with only relevant partners

9. Delivery of contract and services
Lead Provider
Lead Provider
Subcontractor 1
Subcontractor 2
Subcontractor 3
Delivery of contract and services

10. Delivery of contract and services
Prime Contractor / Managing Agent
Prime/ Managing Agent
Subcontractor 1
Subcontractor 2
Subcontractor 3
Delivery of contract and services

11. Special Purpose Vehicle
New legal entity
Either delivers contract itself through transferred staff/resources or subcontracts to member organisations
Organisation 1
Organisation 2
Organisation 3

12. Operates as hub or long term standing consortium
member
New Entity
Operates as hub or long term standing consortium
member
member
member
member
member
s.c.
s.c.

13. Merger
Merger is where two or more organisations formally combine to form one organisation.
The term merger has no precise legal definition and is used to cover a number of different processes. Some mergers may also be referred to as takeovers

14. External drivers Pressure from funders to reduce duplication
Government encouragement
Competition with similar organisations
Stakeholder opinion
Public perception of an overcrowded voluntary sector

15. Internal drivers Desire to provide more or better services
Need to increase efficiency through better use of resources
Preventing duplication of services
Financial difficulties
Raising public profile or boosting income
Loss of key staff or trustees
‘Survival’ &‘ rescue’

16. Merger leading to a new organisation
Organisation A
Organisation B
Organisation C
New organisation

17. Merger using an existing organisation’s structure
Organisation B
Organisation A
Organisation A

18. Things to consider
Do the outcomes justify the time and resources invested?
Loss of autonomy
Cultural mismatch
Mission drift
Damage if unsuccessful, which could be fatal

19. What if it goes wrong?

20. Any questions ?