Strategic Restructuring:
Partnership Options for Nonprofits

Types of Strategic Restructuring
Merger

	Is Merger Right for Us? Use our decision tree to help you decide. Click Here What form of Strategic Restructuring is Right For Us? Use our decision tree to help you decide. Click Here

A merger involves the integration of all programmatic and administrative functions of multiple organizations, to increase the administrative efficiency and/or program quality of one or more of the partners. Mergers occur when one or more organizations dissolve and become part of another organization's structure. The surviving organization may keep or change its name. A merger also occurs when two or more organizations dissolve and establish a new structure that includes some or all of the resources and programs of the original organizations. A well-known example of a nonprofit merger occurred in 2000, when America's Second Harvest and Foodchain merged to form a larger, more comprehensive America's Second Harvest. Mergers do not have to be between large organizations, however - there are hundreds of examples of nonprofits of all sizes and mission types, in all parts of the country, that have merged just in the last decade.

People with experience in the for-profit sector often refer to "mergers and acquisitions." However we do not use the term "acquisition" in a legal sense in the nonprofit sector. Since nonprofits have no identifiable owners, nonprofit corporations cannot be bought or acquired. Certainly no legal maneuver among nonprofits corresponds to the acquisition of a publicly traded corporation. Nonetheless, many mergers feel to participants very much like acquisitions. Use of the term is widespread, usually in reference to a merger in which one party is considerably larger or stronger than the other.

For more information, see these Case Studies on Mergers.