The Kennedy Center (DC) announced today that:
it will take over most operations of the Washington National Opera because of the music company's financial troubles. Under an affiliation agreement, the opera will remain a separate nonprofit with its own board of trustees. However, the Kennedy Center will take over its business, fundraising and marketing functions. The arrangement beginning July 1 ensures the opera's survival amid several years of financial shortfalls. The Washington Post noted that the Center's effort with the Opera is similar to the National Symphony Orchestra, which has been a Kennedy Center affiliate since 1986.
I believe that he Kennedy Center's commitment to take-on this challenge may serve as a good model for institutions with similar challenges in other communities. A well-healed organization may indeed find opportunity to lend its capacities, from back-room to fundraising, to other institutions, particularly if working within the same genres, reducing learning curves about the business and lowering the costs to reach similar if not identical audiences, and, possibly (probably in the Kennedy Center's case) increasing revenues for both institutions.
The only pause here relates to the use of the "merger" word by the Post. The rest of the article does not suggest this arrangment is a merger which is when two organizations become one organization. Indeed, the Board of the Opera and the organization's nonprofit status is being kept in place. If anything, this is an acquisition by one nonprofit of another with the acquired becoming a subsidiary - still independent and responsible for productions but financially and operationally managed by the parent.
In these times, all models for achieving survival must be considered. The Kennedy Center gets credit for demonstrating some of the possibilities.