Its official Peter Jackson and New Line cinema have finally settled their bad blood and will together create not one but two J.R.R. Tolkein Hobbit films.

MGM’s chairman and Ceo states Tuesday that, “Peter Jackson has proven himself as the filmmaker who can bring the extraordinary imagination of Tolkien to life and we full heartedly agree with the fans worldwide who know he should be making The Hobbit”.

Peter Jackson confirms the film “I’m very pleased that we’ve been able to put our differences behind us, so that we may begin a new chapter with our old friends at New Line.”

Variety.com reports that the rewrite of the script is pending a resolution to the writers strike, but the first Hobbit film is still tentatively scheduled to be shot in 2009.

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