Aquarius, which has been a charity since 1992, will remain a registered charity and a limited company in its own right.
The Richmond Fellowship is one of the largest voluntary sector providers of mental health care in England and helps more than 9,000 people a year. It currently employs about 1,300 staff, according to a spokeswoman for the charity. It had an income of £29.3m and spent £29.1m in the year to 31 March 2014, according to accounts filed with the Charity Commission.
Aquarius employs 165 staff, according to a spokeswoman for the Richmond Fellowship. The latest filed accounts with the commission show that Aquarius had an income of £7.3m and spent £7.6m in the year to 31 March 2014.
Annette Fleming, chief executive of Aquarius, told Third Sector that no staff would be made redundant as part of the agreement.
Fleming said Aquarius had decided to join forces with the Richmond Fellowship because it was becoming increasingly difficult to compete with larger national agencies for contracts. She said: "We felt that becoming part of a national structure and part of a mental health charity would strengthen what we are able to do and increase the spread of the work we are able to do."
Derek Caren, chief executive of the Richmond Fellowship, said in a statement: "Coming together as a group will also ensure we’ve a solid financial foundation to be able to achieve all that we want. It’ll offer opportunities to make efficiency savings and streamline our processes, allowing us to invest more in our front-line activity."
Aquarius will retain its own trustee board and its chairman David Millard will join the Richmond board as a non-executive director, according to a spokeswoman for the fellowship.
Aquarius is the fifth organisation to become a subsidiary of the Richmond Fellowship since April 2011. The other organisations are: the mental health charity 2Care; the Northampton-based alcohol and substance misuse charity Can; the Cumbria-based mental health charity the Croftlands Trust; and the Birmingham-based community mental health social enterprise My Time.