mergers and collaborations, philip kirkpatrick, bates wells and braithwaite and tina winders,...
DESCRIPTION
Practical guidance on mergers and collaborative working arrangements.TRANSCRIPT
![Page 2: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/2.jpg)
Emerging from a MergerLessons learned from the merger of
bassac and DTA
Tina WindersDirector of Finance and Corporate Services
Locality
![Page 3: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/3.jpg)
• History of partnership working• Community Alliance • Membership• Corsham Street - joint staff
The case for merger
![Page 4: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/4.jpg)
• Exit strategy for end of a programme• Manchester Settlement meeting• Trustee engagement• Financial• Need - on either side?
The catalyst
![Page 5: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/5.jpg)
• Staff relationships • Chief Executives• Finance/operations directors• Funders• Strategic Partners
Trust
![Page 6: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/6.jpg)
• Merger v take over• Sensitivities• Larger = more generous• Culture – acknowledge differences, what will
new organisation be like.• Perceived differences greater than actual
Perceptions
![Page 7: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/7.jpg)
• Lawyers (BWB)• Independent consultants (IVAR)• HR – in house/ Croner• PR and branding (Public Life)
Professional Help
![Page 8: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/8.jpg)
• Costs– Legal fees
– Pension liability
– Redundancy costs
– Rebranding, launch
– Due diligence accountants fees
– Governance, additional meetings etc
– Cancelling supplier contracts
• Benefits– Synergy of 2 member
networks
– Savings in SMT, support staff
– Reduced costs of audit, insurance, annual member conference, regional networks
– Opportunity to refresh, marketing etc
– Taken more seriously, more able to sit at the “top table”
Costs v benefits
![Page 9: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/9.jpg)
• Time – too quick v too slow• Consultation union/staff forum• Various types of communication• Joint team days, social events• Listen• Be prepared to change plan
Process
![Page 10: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/10.jpg)
• DTA-bassac/ bassac-DTA• Suggestions ranged from
“bastads” to “community matters”!• Shortlist of 6• (Nearly!) Unanimous support for
locality
What’s in a name?
![Page 11: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/11.jpg)
• Director of integration• Lots of form filling and new signatures needed!• Need to things get in the right order• Launch – venue, publicity
Next steps
![Page 12: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/12.jpg)
locality.org.uk
![Page 13: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/13.jpg)
Part 2
Structures and Legal Considerations
Philip KirkpatrickCo-Head
Charities and Social Enterprise DepartmentBates Wells & Braithwaite London LLP
![Page 14: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/14.jpg)
Spectrum of collaborative arrangements
Sharing knowledge Collaborative working on issues/projects Joint venture by contract Joint venture through new entity Shared purchasing Shared services Merger
![Page 15: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/15.jpg)
Main Collaborative Structures
Un-documented joint working Memorandum of understanding Written contract (JANE) Partnership agreement Limited liability partnership Limited company Group structure Federation
![Page 16: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/16.jpg)
Collaboration Checklist
Compatible objects? Objectives of collaboration How long will it last? Who contributes what? When and how? Effect on staff? Who employs / seconds? Who disciplines?
![Page 17: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/17.jpg)
Collaboration Checklist
Management and governance processes Who decides what? How? Steering committee? Role of the boards Communications – internal and external Policies Budget and budgetary control Accounting arrangements
![Page 18: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/18.jpg)
Collaboration Checklist
Admission of new partners / members Profit distribution Tax and VAT IP and data ownership / management Liability:
contract tort
Insurance Dispute resolution
![Page 19: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/19.jpg)
Collaboration Checklist
Conflicts of interest Data protection Joint ownership problems:
land/premises intellectual property other assets
Methods/timing of termination Consequences of termination
![Page 20: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/20.jpg)
Basic Merger Structures: Asset Transfer 1
A B
![Page 21: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/21.jpg)
Issues on Asset Transfer 1
B assumes liabilities of A Therefore good due diligence vital Simpler/cheaper resulting governance and
management structure Feels like a takeover (but it needn’t)
![Page 22: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/22.jpg)
Basic Structures: Asset Transfer 2
A
B
C
![Page 23: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/23.jpg)
Issues on Asset Transfer 2
As with Asset Transfer 1 except: feels less like a takeover
more expensive
If you had to pay the costs personally, how would you do it?
![Page 24: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/24.jpg)
Basic structures: Group 1
B
A
![Page 25: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/25.jpg)
Basic Structures: Group 2
C
A B
![Page 26: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/26.jpg)
Issues with Groups
Tighter than mere contract arrangements Cheaper to establish No transfer of liability More complex/expensive governance More complex/expensive management Easier to persuade boards? Useful stepping stone?
![Page 27: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/27.jpg)
Basic Structures: Federation
F
M
M
M
MM
M
![Page 28: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/28.jpg)
Issues with Federations
Collaborative rather than merger structure No transfer of liability Role is to co-ordinate/support independent
activity One member can damage reputation of all Need clear, binding rules of
conduct/membership Need proper control of IP Federation needs to add value
![Page 29: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/29.jpg)
Legal Due Diligence
Objects and powers Members Structure – corporate / unincorporated? Regulatory support / approval? Contracts / grants Debts Employees and TUPE Pensions Litigation / disputes
![Page 30: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/30.jpg)
Legal Due Diligence
Properties freeholds / leaseholds restrictions on disposition (s 36 CA 1993) charges condition
Permanent endowment / specie land Other special trusts
![Page 31: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/31.jpg)
Legal Due Diligence
Hire purchase / leased assets Intellectual property Information technology Investments Tax / VAT Trading company Data protection Insurance Other sector specific issues
![Page 32: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/32.jpg)
Merger Agreement
What transferring? Warranties and indemnities – where does
risk lie? ongoing contractual liabilities known creditors unknown creditors liabilities arising from breach of trust liabilities arising from excusable breaches
of trust run-off insurance?
![Page 33: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/33.jpg)
Merger Agreement
Conditions consents from / registration with regulators consents from funders / contractors member approval
Pre-assignment / novation / consent contract / lease arrangements
TUPE Announcements
![Page 34: Mergers and Collaborations, Philip Kirkpatrick, Bates Wells and Braithwaite and Tina Winders, Development Trusts Association](https://reader035.vdocuments.site/reader035/viewer/2022070317/5562c615d8b42a13618b55a9/html5/thumbnails/34.jpg)
Philip KirkpatrickPartnerCo-Head of Charity and Social Enterprise
Bates Wells & Braithwaite London LLP
DD: 020 7551 7835www.bwbllp.com