Alliance Atlantis Communications and Germany’s Kinowelt Medien ag have inked a $400-million financial and operating partnership that aac president Lewis Rose says strategically is an ‘intelligent and logical combination.’

The major shareholders of Munich-based Kinowelt will acquire around 6.276 million non-voting shares of aac from treasury at a price of $21 each. The two companies will establish a us$150-million ($223.4 million) fund to develop, produce and acquire motion pictures for international distribution, and Kinowelt will acquire 50% of aac’s u.k. motion picture distribution business. The partnership will commit us$25 million ($37.2 million) per annum to the development, production and/or acquisition of motion pictures for exhibition in the u.k.

‘We are combining [Kinowelt’s] distribution strength and knowledge in Europe with aac’s strength and knowledge in Canada and North America,’ says Rose.

Kinowelt is Germany’s largest independent motion picture distribution company, with access to approximately 4,300 screens.

Also at aac, the company has reportedly entered into a partnership with Fox World Cinema to create a sell-through video distribution label in the u.k. for independently produced films. The label will focus on titles released theatrically by aac. The launch of the new initiative is set for Sept. 27, with Atom Egoyan’s The Sweet Hereafter, Neil LaBute’s In the Company of Men and Takeshi Kitano’s Hana-Bi.