A deal has been brewing for some time between the Canadian giants. In May, Deadline reported word was spreading about a hookup during the Cannes Film Festival, and eOne later confirmed it was in talks to buy rival Alliance. Today’s announcement comes just as the Toronto Film Festival is getting underway where both companies are handling a host of titles. The merger will create a group with reach across Canada, the UK, Benelux, Australia, the U.S. and Spain. EOne has The Twilight Saga: Breaking Dawn Part 2 coming up and purchasing Alliance will give it Canadian rights to 11,000 titles including The Hunger Games. A deal is subject to regulatory approval. Here’s the press release on the proposed acquisition:

TORONTO, ONTARIO – Today the Board of Entertainment One Ltd. (LSE:ETO) (“eOne” or “the Group”) announces that it has entered into an agreement to acquire Alliance Films, a leading independent distributor of filmed entertainment products in Canada, the United Kingdom and Spain, from affiliates of GS Capital Partners and Investissement Québec for approximately CAD$225 million.

Completion of the transaction will establish eOne as the largest independent film distributor in both the Canadian and UK markets. Entertainment One’s Board believes that the acquisition will strengthen eOne’s existing film distribution business and help drive growth.

“The combination of Entertainment One and Alliance Films will create the leading global independent film distribution business which alongside our Television and Family divisions will deliver a strong strategic platform for long term growth. As a result of the acquisition, eOne will be a more competitive business in each of the geographic markets that we serve, allowing us to act as a more valuable partner for content producers and expanding the quality and depth of the content that we offer to our customers”, said Darren Throop, President & CEO, Entertainment One. “I am extremely excited by the opportunities available to us to grow the Group and we look forward to representing the very best in independent film across all of our markets. This acquisition means that eOne is better positioned than ever to generate significant value for shareholders.”

Alliance Films and Entertainment One operate in geographies that are highly complementary and, following the transaction, the Group will have an international reach across Canada, the United Kingdom, Benelux, Australia, the United States and Spain. Upon completion of the deal, the Group will have increased access to the most successful independent film studios through output agreements in Canada including with The Weinstein Company, Focus Features and Relativity.

Alliance Films’ slate includes a busy lineup at this week’s Toronto International Film Festival including the opening night film, Looper, as well as Place Beyond the Pines, Hyde Park on the Hudson, Dredd, Anna Karenina, Seven Psychopaths, Silver Linings Playbook, Quartet, Lords of Salem, The Bay, Antiviral, Foxfire, Inescapable and Laurence Anyways.

“eOne and Alliance Films share similar values. We both have a strong commitment to supporting film, culture and talent in Canada and in each of our territories. We also have passion for this business. Joining the eOne family will provide our dedicated teams and partners more opportunities to work with great films and film makers from around the globe,” said Victor Loewy, Chairman and CEO, Alliance Films.

eOne released 152 films theatrically over the year including The Twilight Saga: Breaking Dawn – Part 1, We Need to Talk About Kevin and Tinker, Tailor, Soldier, Spy and the Group is presenting 18 premium films, as well as titles being sold by the international sales team, at the Toronto International Film Festival this week.

In August 2011, eOne announced an expansion of its North American film operations and an increasing focus and commitment to theatrical distribution in the US. The company also expanded its international film businesses and its international television in the UK and Europe last year.

Entertainment One is also currently a leading independent television production studio in Canada. Through new commissions and renewal of existing programs, the company delivered 237 half hours of original television in various genres in its last fiscal year.

Completion of the acquisition is conditional, amongst other things, on approval being received from the Canadian Competition Bureau.