Canadian media conglomerate CanWest Global Communications and New York-based investment bank Goldman Sachs are in exclusive negotiation toward a possible purchase of Alliance Atlantis Communications ( AAC ), AAC confirmed this morning. According to a report in today's Globe and Mail newspaper, a deal, estimated at $1.8 bn (C$2.1 bn), is imminent.

AAC announced Dec 19 that its controlling shareholder, Southhill Strategy, owned by AAC executive chairman Michael MacMillan and former AAC executive Seaton McLean, was exploring strategic alternatives.

Industry observers speculate that CanWest's interest in AAC is limited to its broadcast assets, including 13 specialty channels, while Goldman Sachs will be looking to sell off the company's lucrative CSI : Crime Scene Investigation franchise, of which AAC owns international distribution rights, as well as Motion Picture Distribution, the releasing arm of AAC, which includes Momentum Releasing in the UK and Aurum in Spain. AAC effectively controls 51% of the releasing arm through an income trust arrangement.

While Goldman Sachs is understood to be paying the majority of the purchase price, CanWest's Canadian status will allow the deal to happen. Canadian regulatory policy prohibits majority foreign ownership of Canadian broadcast properties.

CanWest is Canada 's second-largest private broadcaster and also maintains large holdings in newspaper and other media in Canada and in Australia.

In a statement, AAC said: ' There can be no assurance that these discussions will result in a definitive agreement.' AAC stock price yesterday closed at a record high of C$53.

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