Synergy created in charity mergers

By Neil Burton

With more charities being urged to merge to cope with reduced funding, we take a look at the potential advantages in merging and the legal points to consider before going ahead.

In recent times, a fall in donations coupled with greater overheads and an increased appetite for services has led to many charities struggling to keep a healthy balance sheet. As a result, charities, like other commercial entities, are increasingly considering the benefits of merging with similar organisations. Take St Mungo’s and Broadway, for example, which recently announced plans to unite in April 2014.

When considering merger opportunities, the key consideration for trustees will be whether the proposal is in the best interests of the beneficiaries. In theory, effective co-operation can achieve this through increased efficiency, lower costs and an improved delivery of services to those beneficiaries…

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