Salter Street Films, the Halifax-based production company behind such hits as This Hour has 22 Minutes, has been bought by Alliance Atlantis Communications for $80 million in stock and cash.

Shareholders of Salter Street Films can choose to get either $3.33 in cash and 0.31 of a Class B non-voting share of Alliance Atlantis for each Salter Street share, or 0.465 of an Alliance share.

The companies say that works out to be worth about $9.22 a share. Salter Street closed on Friday at $6.60 a share.

Shareholders owning 71 per cent of the voting stock have already committed to tendering their shares.

The deal will give Alliance Atlantis access to Salter Street's 21 licences to operate digital channels, along with a host of other television programs like Made in Canada, Blackfly and Emily of New Moon, along with the science fiction series Lexx.

"Salter Street Films' library, expertise in comedy production and emerging specialty channel business are attractive to us," said Michael MacMillan, chairman and chief executive of Alliance Atlantis.

Salter Street Films also owns Salter New Media, operator of Q1234.com, a Web-casting portal for investors, investor relations professionals, and publicly traded companies.

Salter Street Films rose $1.66 to $8.26. Alliance Atlantis Class B shares fell $1.90 to $17.10.