Association of enterprises. Associations and unions. Types of Business Combinations

The combination of enterprises, as many modern analysts believe, is a global trend. There is an opinion that in the coming decades most of the world's companies (which in aggregate will give about 70-75% of the planet's GDP) are consolidated within only a few hundred transnational holdings. Russian business, this trend, as economists believe, will also affect.

There are two main mechanisms within which companies can be merged. As part of the first, it may be about changes in the legal status of a company that arise as a result of mergers or acquisitions. A controlling stake or a predominant share in the authorized capital in this case passes from one group of persons to another, and the brand name (and sometimes the industry) where the firm operates also may change. The most common types of associations of enterprises of this category are concerns and holdings. Among the obsolete, but of great historical importance for Russia - trusts, cartels and syndicates.

Another mechanism that also fits the notion of "combining enterprises", in turn, is not associated with a change in their legal status. It implies the consolidation of an associative type - with the aim of exchanging experience among entrepreneurs or state managers (if it comes to state-owned companies), jointly solving urgent problems, mastering new perspectives through the pooling of knowledge and resources. The main types of associations of enterprises of this type today are associations and unions.

Before studying the features of each of the mechanisms of consolidation of companies, we will study the aspect reflecting the actual appropriateness of the centripetal trends in question.

Why do enterprises come together?

Among economists, there is an opinion that small businesses somehow expand their presence in the market. At some point the company reaches a level in its development when further expansion of business is possible either only through absorption of other businesses (most often competitors) or by merging with them in some form or another. Of course, it is possible and very likely the option, when the business itself is absorbed, in turn.

On average, the company operates on the order of 3-5 years before the issue of merger procedures arises. The need for consolidation can also arise due to market circumstances. As a rule, this state of affairs is typical for periods of crises (both economic and political nature).

Benefits

The unification of enterprises is a process that, in most cases, benefits each of the actors involved in it. The main advantages of consolidating businesses can be manifested in the following.

First, companies, having united, as a rule, form a certain commonness of databases: customers, suppliers, partners. This almost always increases the revenue of each of the firms that make up the pool.

Secondly, companies tend to record a reduction in costs in many areas - for example, in relationships with the same suppliers. It often happens that the firm, having at the disposal of new counterparties, discovers that the goods or services they supply are cheaper than those received from previous partners. Also, the costs associated with brand positioning and advertising are usually reduced.

Thirdly, firms unite not only information, but also financial resources. This allows, first of all, to count on attracting more qualified specialists to the staff. Personnel - the most important component of the success of any business. Similarly, more financial opportunities - better equipment. This is especially important when combining industrial enterprises - their main competitive advantage lies in the technologies used in the production of products.

We learned about why businesses need consolidation. Now in details we will consider the forms of association of enterprises, which we defined as the most widespread in Russia.

Concerns

Let's start with concerns. This type of consolidation of businesses implies a fairly high degree of independence of the participants. As a rule, the interaction of companies is limited to the exchange of technologies (patents, licenses), in some cases the financial management mechanisms are unified.

The concern can be both an association of enterprises of one industry and consolidation within the framework of firms operating in quite different segments. But as a rule, its participants are somehow interconnected. For example, within the framework of a concern, companies in one production chain can join together: suppliers of raw materials, processing factories, and factories that produce the final product.

As a rule, companies that form a concern (examples from Russian business in many ways confirm this), remain legally independent. A controlling stake in each or the majority share in the charter capital does not normally belong to the head structure. And this is the main difference of the concerns from the holdings (we'll look at their features a little later). However, as we said above, management of financial flows, as well as strategic decisions in the field of management are applied at the level of the top management of the association. In this regard, the legal independence of companies, as many experts believe, may not play a significant role in terms of developing firms as separate business units.

Organizations belonging to a single concern may be included in such types of business combinations as associations or unions. This does not affect their legal status and governance mechanisms. But they do not have the right to be part of other concerns. Otherwise, there may be differences with the strategic priorities of the consolidated business structure.

Concerns in Russia

How does this type of association function in Russia as a concern? Examples of businesses consolidating in the framework of this form, of course, are found in Russia in a very large number.

There are, in particular, state industry concerns. Experts consider it to be one of the largest and most famous Russian companies in the world - Gazprom. It often happens that the concern is an association of state enterprises of the defense industry.

The term "concern" in Russia and in the world

The question arises whether the term "concern" has the same meaning in our country and abroad. Everything depends on the specific state. Let's consider some examples. In particular, concerns in Russia are called companies such as Volkswagen, Siemens, Allianz. In turn, in the country of origin - Germany - these organizations are called exactly the same, Konzern. If, in turn, we are talking about such companies as General Motors, or Boeing, having an American residence permit, in Russia they are also considered to be concerns. But in the US - no. There they are called "public company".

In some cases, the largest companies from the United States in Russia among Russian mass media or in specialized literature are referred to as concerns only in order not to mislead the reader inadvertently. The fact is that many American companies, for example, the automobile giant Chrysler - it's nothing more than "LLC" (in English - Limited Liability Corporation). Russian philistine will never believe that "LLC" is able to grow to such a scale: in our understanding it is a very average firm. It is easier for him to understand what an enterprise is - a concern.

Holding

As we have already said, the most common forms of association in Russia are also represented by holdings. This type of business consolidation, as experts say, is very close to the concerns (moreover, some economists identify the two terms). What are the distinctive features of holdings? And what, in turn, is there in common, between them and the concerns?

The most important sign of a hosting is that it is an association of organizations, enterprises, with the obligatory condition: concentration in the ownership of the head structure of a controlling stake in all firms. While in the concerns it is allowed (though not always the case), that the majority of the business belongs to the founders of the firm or to third-party shareholders.

For most of the signs (purpose of creation, type of management, etc.), holdings in general are very close to the concerns. They can also be associations within one or more industries, be a consolidating structure for businesses in terms of organizing the production chain. As well as in the case of concerns, enterprises that are part of the holding, as a rule, have legal independence, conduct an independent economic activity on the whole.

But the key management decisions are still the head structure. Its main competencies are as follows.

First, it develops the conceptual basis for the development of the whole association. He thinks about the strategy of attracting and allocating investments and profits. Financial management, as many experts believe, is the main component of the work of the holding's head structure. Funds can be distributed including in the framework of domestic loans.

Secondly, the main structure of the holding company, as a rule, is responsible for key management decisions at the management level of the companies included in the association.

Thirdly, the parent organization represents the interests of all firms that are accountable to it in the inter-branch space and on foreign markets.

In many holdings, by the way, there are restrictions on ownership of shares of the head structure for the companies-participants of the association (as well as for managers and share owners).

Let us now consider the historical forms of association of organizations that played an important role in the economy of Tsarist Russia and the USSR.

Cartels

A cartel is a structure that consolidates the business of one industry. The purpose of creating such forms of associations is to conduct joint activities in the aspect of marketing (less often - production processes). Within the framework of cartels, it was usually easier for companies to sell manufactured goods through agreements on prices, quotas, the use of joint sales channels with other businesses. Companies that are part of the cartels retained complete legal and economic independence.

Syndicates

If the activities of the companies consolidated within the cartels focused on how such sales channels (and not on the production side), then entrepreneurs could agree on creating a syndicate - a single structure for all businesses responsible for selling products at uniform prices and channels.

That is, the function of individual firms was limited to production. Sales were, as a rule, solely created by them syndicate. In some cases, the sales structure was not created separately, but was formed on the basis of the resources of one of the companies included in the association.

Trusts

If cartels and syndicates were usually created in order to optimize channels for the sale of goods, the trusts are in order to consolidate efforts just within the production part (but in many cases sales departments were also merged). Associations of this type were formed by businesses that did not preserve legal and economic independence, unlike cartels and syndicates. As a rule, the head structure of the trust was created (approximately the same as in the holding company). But there were precedents when firms signed agreements on mergers and acquisitions. Usually trusts meant the consolidation of all production processes that are part of a single structure of firms, as well as resources related to them. Businesses from different industries often became participants of such communities. In them, like the way it happens in the above-mentioned concerns, the production chain was built. As a rule, in trusts there was an institution of joint ownership of those resources that were involved in the release of goods (and also for finished products).

Cartels and syndicates were more characteristic of the times of Tsarist Russia (when the institution of private entrepreneurship existed without significant restrictions). And the second was much more. Cartels were, I must say, fairly rare. In the USSR (until the moment when commercial relations were banned), the trusts were more popular.

Associations and unions

Having considered the actual and historical forms of consolidation of companies in the process of mergers and acquisitions, consider the second type of business associations - associations and unions. We note at once that fact that these two terms, as a rule, can be identified. Just "association" - this means "unification", "union", only in a foreign manner. Businesses themselves determine how to call themselves within a consolidated structure.

Associations and unions are associations of organizations (private or state) not for the purpose of consolidating financial and managerial resources, but for protecting interests and coordinating different areas of work. Almost always, these are structures of a non-commercial type. That is, if we talk about the legal status - this is usually an NGO. Firms belonging to an association or union retain absolute legal and economic independence.

The scale of such organizations can be very different. For example, the Association of Restaurateurs and Hostels. On hearing at many such association - "the Union of industrialists and businessmen". There are international and political structures (the purpose of which is to establish business ties). Among them are the Customs Union.