services > strategy > choosing a merger partner

choosing a merger partner

Many associations are currently in the process of deciding whether or not to seek to merge with another association or associations to form a stronger Group.

This is a key decision for the association, not to be taken lightly, and involving many considerations such as whether:

. the new group would be significantly stronger financially than each of its parts, and in particular stronger than your own association currently is
. it would be better placed to take advantage of developmental opportunities and obtain funding
. significant admin costs could be saved
. the management team would be strengthened
. there could be a clash between the cultures of the merging associations.

We are very well equipped to advise associations about these issues, and assisting in the process of merger investigation is becoming a significant part of our work portfolio. 

Our methodology for choosing a merger partner is rooted in our knowledge of quantified grading systems for banks funding the sector, and is further informed by our recent experience of designing risk-based regulation for the Housing Corporation.  Combining these methodologies enables us to estimate the probability that a given housing association will get into financial or regulatory trouble.

An example of the application of our methodology for choosing a merger partner is described here.  Disguising the identity of the organisations involved, we ask the question: is A the best possible merger partner of B?


words of wisdom

"By all means marry; if you get a good wife, you'll be happy. If you get a bad one, you'll become a philosopher."





Hargreaves Risk and Strategy