The latest Narnia instalment has suffered a severe setback with the news that Disney has pulled out of the third outing of the C.S. Lewis series.
The major has chosen not to exercise its option to co-produce and co-finance the next instalment of the franchise - "The Voyage Of The Dawn Treader", reports The Hollywood Reporter.
Disney and Walden Media confirmed that the project, which is set for a 2010 release, has been put on hold due to 'budgetary and logistical reasons'.
Walden is currently looking for a new partner, with 20th Century Fox tipped to be the most likely.
The first two instalments, "The Lion, The Witch And The Wardrobe" and "Prince Caspian" grossed $731 million internationally in total.