Pinewood Studios and Shepperton Studios, the UK's two leading film production facilities, have finalised a merger that will create a European super studio.

Pinewood will take control of Shepperton, which is co-owned by directors Ridley and Tony Scott. Pinewood chief Michael Grade will become executive chairman of the new group, while the Scotts become co-chairmen.

The deal reportedly has backing to the tune of $50m (£35m) from venture capital group 3i, which takes a 60% shareholding. The merger, which received government approval last year, sees both studios keep their respective names.

Meanwhile, Grade is also reportedly launching a $43m (£30m) venture capital fund for investing in the leisure and media sectors. The former Channel 4 boss is understood to have set an early April deadline for investors in the fund, named The Leisure and Media Venture Capital Trust. It is unclear whether the fund, which will be listed on London's AIM stockmarket, will be related to Grade's studio interests.

Grade has said the Pinewood-Shepperton merger will help the studios secure large-scale US productions in the face of increasing overseas competition. The new studio group may now seek to unite with a production operation on the European continent.