Spanish animation studio Dygra Films is preparing an ambitious 3D digital animated feature, A Midsummer Night's Dream (El Sueno De Una Noche De San Juan).

The project marks the company's follow-up to hit The Living Forest (El Bosque Animado), Spain's tenth top-grossing local film in 2001 and second highest-selling video of all time. Forest was also pre-selected for the best animated film Oscar this year.

Midsummer Night (working title in English), a Shakespeare-inspired tale about a magic world which finds itself in jeopardy when humans stop dreaming, is in pre-production and planned for a 2005 delivery.

Buena Vista, which distributed Forest in Spain, will also handle local distribution on the new title, a Euros 6m co-production with Portugal's Appia Filmes.

Dygra executive producer Manuel Cristobal and Manolo Gomez, co-director of the new project with Angel de la Cruz, say they hope to close pre-sales on Midsummer Night with some of the same near-dozen European distributors handling Forest.

"The Living Forest served as a calling card for Dygra as an animation studio for products which work on both the national and international markets," says Cristobal. "As the first film created entirely on PCs, it also reflected our goal of being innovators, of combining animation and multimedia and trying to go beyond the limits of 3D," adds Gomez.

Dygra is also active in various training initiatives, collaborating with local universities and co-hosting the recent Cartoon Master Future workshop. Its studio complex in Galicia, Spain uniquely houses artists and technicians together and has a core staff of 40 which balloons to more than 100 during production phases.