Viacom Inc. unit Paramount Pictures has reportedly reached a deal to buy live-action film studio DreamWorks SKG, after DreamWorks ended negotiations with rival bidder, General Electric Co.’s NBC Universal, the Wall Street Journal reported Friday evening, citing sources familiar with the negotiations.

The paper’s Web site reported that Paramount agreed to pay $825 million to $900 million, with the assumption of as much as $500 million of debt. The New York Times put the price at $1.6 billion, including the assumption of about $400 million in DreamWorks’ debt.

Earlier in the evening, DreamWorks executives told NBC Universal officials that they would not pursue that studio’s bid, according to the insiders.

The Journal said Viacom’s board cleared the way for Paramount’s bid on Thursday, on the condition that outside investors put up most of the money for the offer. Paramount has been in talks with investors since November to raise about $800 million to help back a possible bid, the Journal said. It is unclear whether it has investors lined up yet.

DreamWorks, founded by Steven Spielberg, David Geffen and Jeffrey Katzenberg, was said to be looking for a price of about $1 billion plus the assumption of debt.

By acquiring the studio, Paramount gains the right to distribute movies by DreamWorks Animation SKG Inc. and wins control of DreamWorks’ 60-title film library. Speilberg would be a producer.

Paramount had explored making a bid for DreamWorks before, but was told by its parent company that it wouldn’t get approval during Viacom’s transition into two companies. Viacom plans to divide by the end of 2005.

Viacom’s board, concerned about a bidding war, expressed a preference for exclusivity in its talks with DreamWorks. DreamWorks had been in talks with Universal for months.