Peter Jackson says he is still keen on making The Hobbit, prequel to The Lord of the Rings series, as long as the complex legal issues can be resolved.

"I'd be interested in doing it because I think it would give continuity to the overall chapter," he told Reuters.

Although many of the leading characters do not appear in the prequel, the wizard Gandalf, played by Ian McKellen, and Gollum, played by Andy Serkis, do make an appearance. Arwen, the elf princess played by Liv Tyler could also feature again, Jackson said.