Del Toro gets Hobbit helm

In a move that will thrill fantasy fans the world over, genre superstar Guillermo del Toro has been hired to direct JRR Tolkien's The Hobbit.

Last night's widely predicted announcement came four months after Kiwi film-maker Peter Jackson, who famously turned Tolkien's Lord of the Rings trilogy into a $3bn multi-Oscar winner, unveiled the project.

At the time Jackson said he would act as executive producer on The Hobbit and an original sequel that would bridge the 60-year gap between that book and the trilogy. However he did not say he would direct the films, prompting industry-wide speculation about who would assume the mantle of Tolkien's interpreter-in-chief.

Now the mystery is over and few would disagree with Del Toro's credentials. The Mexican film-maker is a darling of the fantasy community - films such as Pan's Labyrinth, Blade 2 and Hellboy have earned him legions of fans. He is currently putting the finishing touches to this summer's sequel Hellboy II: The Golden Army.

Within the year Del Toro is expected to relocate to New Zealand for four years to shoot both films back-to-back, a method Jackson employed on the Lord of the Rings trilogy. Jackson's Wingnut and WETA production facilities will once again provide digital effects.

"This is a great honour, and I am indeed blessed to become a part of the film-making community that Peter, Fran [Walsh, Jackson's partner] and their extraordinary team of collaborators have created in New Zealand," Del Toro said. He went on to say that the appointment was "a dream come true".

New Line, the studio that backed the Lord of the Rings franchise, will be closely involved in developing the two screenplays. Warner Bros will release the films in the US and MGM will take charge of overseas distribution.