Rural Affairs Minister Éamon Ó Cuív and junior minister John Curran said the move was first proposed in late 2008.
It is envisaged that the new organisation would supersede Comhar Leader nah-Éireann (CLÉ), PLANET and the Community Partnership Network (CPN).
Both Ministers stated that additional time had been given to allow for the submission of final proposals by the three organisations but there was now a need to ensure that the new organisation was in place by November.
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Any further delay would jeopardise funding, they said.
Prior to January this year there were almost 100 local development companies delivering local or rural development programmes and schemes on behalf of the department.
On foot of a cohesion process completed then, these companies were replaced by 53 companies, most of whom now deliver local and rural development programmes on an integrated basis.
"With the completion of the cohesion process, and in view of the fact that the majority of the new companies now deliver services on an integrated basis, it is agreed that one single representative organisation for the new companies is all that is required," said a spokesman for the department.
"This would also be more efficient and cost effective than current arrangements."
(PR/KMcA)
