"DreamWorks Animation SKG Inc. said Wednesday it will begin operating under its new distribution deal with Paramount Pictures with its next animated film, ""Over the Hedge,"" set for release in May.

Paramount, which said in a separate statement on Wednesday that it closed its $1.6 billion acquisition of DreamWorks, has the right to distribute DreamWorks films on a worldwide basis under the agreement.

The Viacom unit will be responsible for the marketing and distribution of DreamWorks films and earn the same 8 percent distribution fee that DreamWorks had received. The deal expires by the end of 2012. DreamWorks received $75 million in cash in the agreement that it used to repay debt, it said.

DreamWorks plans to release ""Over the Hedge,"" in theaters May 19.

Paramount, in its separate statement Wednesday, also said it is ""well along in its process"" to sell the DreamWorks live action film library.

DreamWorks shares rose 17 cents to $26.97 in morning trading on the New York Stock Exchange."