STEVE JOBS, the founder of Apple Computer, is poised to become one of Hollywood’s most powerful figures as he conducts talks to sell his Pixar animated films business to the Walt Disney Corporation in an all-share deal worth about $7 billion (£4 billion).

The talks could lead to Disney taking control of the studio responsible for animated classics such as Toy Story and to Mr Jobs becoming the biggest investor in the media and entertainment group. The Pixar deal would also be expected to open the way towards the next big advance in media convergence.

Mr Jobs, who would take a seat on the board of Disney, built Pixar into a multibillion-dollar film-maker, having bought the computer graphics division of George Lucas’s Lucasfilm for $10 million in 1986. The investment is now worth about $3.5 billion, with Mr Jobs owning a little more than 50 per cent of Pixar.

That stake would be converted into a shareholding in Disney of similar value if the takeover goes ahead, making Mr Jobs by far the biggest individual investor in Disney, with a 6.8 per cent holding.

Wall Street sources speculated that Mr Jobs could become the next chairman of Disney if the deal goes ahead. Senator George Mitchell, Disney’s chairman, is, at 72, past the company’s mandatory retirement age and set to step down this year. Bob Iger, the new Disney chief executive, has fought hard to rebuild relations with Mr Jobs and Pixar, picking up the pieces of a partnership that was all but destroyed by his predecessor.

Mr Iger has struck several deals with Mr Jobs recently, chiefly securing the rights to sell Disney’s top ABC television shows through Apple’s iTunes website to be replayed on iPods — Apple’s ubiquitous portable media players.

If the deal goes ahead, full-length feature films made by Disney could be made available to replay on portable players such as the iPod, as could all of ABC’s television content. Apple is also understood to be working on the next generation of iPods, which would have the ability to connect wirelessly to the internet.

Mr Jobs’s presence on the Disney board would facilitate the development of live TV downloads to devices such as the iPod. The companies have been closely tied since Disney agreed in 1995 to distribute Toy Story, which became the highest-grossing film that year. In 1997 the two signed a ten-year agreement jointly to produce five films.

Sources close to Disney said that the takeover of Pixar was one of several deals on the table.

Pixar shares surged nearly 3 per cent to $58.87 while Disney raced ahead more than 4 per cent ahead to $26.24 on Wall Street.

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