Mexican director Guillermo Del Toro is to take JRR Tolkien's The Hobbit to the screen.
After a lengthy legal dispute with production company New Line, Kiwi helmer Peter Jackson, director of the Lord Of The Rings trilogy, agreed a deal to executive produce two films based on the book.
And having been linked with the project since December last year, Del Toro has now been selected as the perfect cinematic choice to translate Tolkien's story for the silver screen.
The 43-year-old, who won three Oscars and three Baftas in 2004 for Pan's Labyrinth, said: "Contributing to The Lord Of The Rings legacy is an absolute dream come true."
Peter Jackson and New Line had been involved in a long-running dispute regarding royalties generated from the hugely successful fantasy trilogy but a statement issued by the studio in December confirmed the Kiwi - and partner Fran Walsh - would executive produce two films based on The Hobbit.
The first is thought to be a straight adaptation of the book and should hit the screen in 2010 while the second is likely to serve as a prequel to the Lord of the Rings trilogy, using Tolkien's lengthy appendices as source material.
In a statement to accompany the signing of Del Toro, Jackson and Walsh called the Blade director: "a cinematic magician who has never lost his childlike sense of wonder".
"We have long admired Guillermo's work and cannot think of a more inspired film-maker to take the journey back to Middle Earth," they added.
Del Toro added: "This is a great honour, and I am indeed blessed to become a part of the filmmaking community that Peter, Fran and their extraordinary team of collaborators have created in New Zealand."
Del Toro's handiwork can next be seen in Hellboy 2: The Golden Army, released in July.