- A professional financial services group formed temporarily to handle a large transaction by pooling their resources and sharing risks, which would otherwise be difficult to achieve without the benefit of the larger group. The most common types of syndicates are insurance, banking and underwriting syndicates.
Most of the time, syndicates are made up of companies or entities that operate within the same industry. Why partner with competitors? Although the decision to partner is not an easy one, it is usually made because of the potential for big returns in regards to a specific project. In other cases, it is done for good publicity. Building a sports stadium, for instance, is a job that few companies could handle on their own. But as part of a syndicate, each company gets to contribute to the larger project, build goodwill within the community and get its name somewhere on the final product.
- Organized crime: A group of freelance criminals or organizations coming together to pursue a larger venture (such as bootlegging) or an intricate casino heist (ala Ocean’s Eleven). As the examples suggest, these syndicates may be ruthless or charming and debonair. They may also make use of a needlessly elaborate hideout, or “lair.”
When a successful company goes public, several investment banks may form a syndicate to underwrite the IPO.