Nonprofit Merger Case Study: United Cerebral Palsy - Seguin Services Inc
In July of 2013, two Chicago nonprofits merged in order to better serve the Greater Chicago special needs community. Founded in 1949, Seguin Services Inc. was formed by concerned parents in Chicago’s western suburbs who felt services for children with special needs were lacking or absent entirely. Offering essential services for persons with disabilities, Seguin has grown to provide Community Integrated Living Arrangements (CILA) group homes, homes for children (with disabilities) neglected or abused, foster care, work opportunities for persons with disabilities, and many other services. In 1995, United Cerebral Palsy of Chicago established its multi-state program focusing on providing services, resources, technology, and access to promote inclusion and independence. This nonprofit merger provides better support for persons with disabilities by combining experience and maximizing contributions.
Although both organizations were fundraising successfully and providing quality service in line with their missions, UCP Chicago and Seguin chose to merge their operations. The nonprofit merger brings the two organizations together while maintaining existing staff and facilities. It additionally created a diverse board made up of 30 civic leaders from the Greater Chicago area. Continuing both organizations’ tradition of fiscal responsibility, they sought to offset the expenses of their merger with private funding and in-kind support. The Chicago Community Trust underwrote some of the merger costs with a major grant of $48,000, while the law firms of Winston & Strawn LLP and DLA Piper LLP provided pro bono legal services. Bringing together two experienced and innovative staffs, the merger also combined the annual revenues (2012) of $26 million at Seguin and $8 million at UCP Chicago. Since the merger, UCP Seguin has successfully increased the combined value of their organization.
With the combined efforts of Seguin Services Inc. and United Cerebral Palsy of Greater Chicago in July 2013, the newly merged nonprofit can more fully share its mission, expertise, and resources while achieving greater operational efficiencies and reduced costs. When working toward similar missions, sharing administrative infrastructure and combining fundraising structures eliminates redundant expenses and decreases the strain on a limited donor population. In each year since the 2013 merger, UCP Seguin has raised over $40 million annually, peaking in 2015 at $45 million. UCP Seguin is financially robust and offers a comprehensive and highly experienced suite of services. The organizations continue to work together and be successful, dispelling the initial fears that often surround mergers such as reshaping benefits, healthcare, time off, and office structure. Most importantly though, the new organization is well-positioned to provide more and better programs and services to help persons with disabilities.
UCP and Seguin were both financially robust, innovative nonprofits boasting decades of service and accomplishments. This merger exemplifies the effectiveness of merging nonprofits when properly planned and executed. These nonprofits could have remained separate and likely seen continued success for many years to come, but combined, they are realizing the maximum potential of their resources. It is a bold and uncertain step to set out in pursuit of a nonprofit merger. There are risks and a long path of challenges, but the result can produce an organization capable of better serving those in need, especially when two complementary groups bring their unique insights together.
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