Hobbit studio sweet-talks Jackson

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THE ONE DIRECTOR: Kiwi filmaker Peter Jackson may still be in the running to direct the precursor to The Lord of the Kings trilogy, JRR Tolkien's The Hobbit.

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Peter Jackson may make The Hobbit after all, despite a financial battle with the studio that commissioned him to film The Lord of the Rings.

Bob Shaye, head of New Line Cinema, has told The Los Angeles Times that the studio - which Jackson has sued for profits from The Lord of the Rings trilogy - has been in talks with Jackson's representatives in a bid to mend fences and get him to direct The Hobbit.

"Notwithstanding our personal quarrels, I really respect and admire Peter and would love for him to be creatively involved in some way in The Hobbit," Mr Shaye said.

He had previously labelled Jackson as "arrogant", while Jackson and partner Fran Walsh took the unusual step of issuing a long statement on the internet last year declaring that because of clashes with New Line they had "no choice but to let the idea of a film of The Hobbit go".

British actor Sir Ian McKellen, who played the wizard Gandalf in the trilogy, is in Wellington to perform with the Royal Shakespeare Company.

At a news conference on Thursday, he said there was no doubt that a rumoured reprisal of his Gandalf role in a film version of The Hobbit would be discussed with Jackson and Walsh.

Jackson's spokesman said last night: "Peter and Fran have always wanted to do The Hobbit but whether that happens is yet to be decided."