US and Canadian home entertainment company Entertainment One, parent company of Koch Entertainment, has struck a deal to acquire UK-based Contender Limited and its Contender Entertainment Group in a cash and stock deal worth about $97m (£49.4m).

Contender's management team led by Richard Bridgwood will remain in place.

Contender has a strong DVD business, focusing mostly on acquiring rights and selling DVDs from third-party producers. It also has a growing theatrical film distribution business, Contender Films, which has recently acquired titles including Air Guitar Nation and Daddy's Girl. The company also has licensing and distribution units to exploit children's content in the UK and internationally from its division Rubber Duck Entertainment, creators of Tractor Tom and Peppa Pig.

Contender's DVD titles include releases of TV shows like Life On Mars and Will & Grace. Its 170-film strong feature library includes Ong Bak and The Grudge.

Entertainment One said it was interested in acquiring Contender because of the importance of the UK and further opportunities to consolidate initially having a strong launch in the UK through Contender. Entertainment One also noted that some Contender content could be exploited in North America and that buying for three territories (US, Canada and the UK) would strengthen its position.

Darren Throop, CEO of Entertainment One, said: 'The acquisition of Contender is our first major acquisition in Europe. It adds to our existing US and Canadian operations and is a significant step in delivering our strategy of building a leading independent international entertainment content owner and distributor.'

Richard Bridgwood, managing director of Contender, added: 'This deal enables Contender to continue its strong growth as part of a larger multi-territory group while retaining the existing highly successful management and staff in place.'