Variety sources claim that Legendary Pictures is in negotiations to acquire Epic Games, creator of the Unreal Engine 3 and hit video game franchisee Gears of War.

The entertainment website cites multiple sources close to the companies which have confirmed that talks are under way. Legendary has already built a relationship with the software company having earlier this year come on-board to co-finance New Line's Gears of War movie.

Both Legendary and Epic Games have declined to comment.

Gears of War 2, the follow-up to the five million-selling Gears of War, is schedule for release exclusively for Xbox 360 on November 7.