Unity, a maker of video game engines, has entered a definitive agreement to acquire Weta Digital, the visual effects studio behind Lord of the Rings, for $1.6 billion.

Unity purchases Weta Digital’s visual-effects tool suite for $1.6 billion Major deal continues the slow merging of movie-creation and game-creation tools.

Unity is set to acquire Weta, the visual effects company co-founded by Sir Peter Jackson, for $1.625bn.

Unity’s acquired company, the tech assets of Weta, will be titled Weta Digital, while Peter Jackson’s Weta visual effects business will remain separate under the banner of WetaFX.

Game engine maker Unity is laying off 265 people, or 3.8% of its roughly 7,000 person workforce, amid a company "reset" and the termination of an agreement with Peter Jackson's digital effects ...