The first 30 "trust schools" which have partners in business, education and the voluntary sector were also announced.
Unilever, Dyslexia Action and Capita are among the firms and charities linking up with schools.
Mr Balls called for more collaborations between schools and other organisations as a means to raise standards.
"I want every good school to be looking beyond the school gates and asking what it can do for its community," said the schools secretary.
"Where a strong school merges with a weak one, both schools make more rapid progress in a federation than they would have on their own," said Mr Balls.
The "trust school" initiative means that a school or group of schools enter a partnership with outside bodies, creating an ethos for this new mini-federation. The trust school would then control staffing, admissions and assets.
