Imax Corporation announced on Wednesday that it has finished a deal to take full control of Imax China by buying up 96.3 million outstanding shares in the Hong Kong-listed subsidiary.
The shares will be purchased for approximately $124 million, representing a 49% premium in the current stock price. Imax says that taking full control of its Chinese subsidiary will allow for “greater operational flexibility to pursue new growth opportunities and applications of IMAX technology in the Chinese market.”
“This deal is a win-win for IMAX Corporation and IMAX China, as it unlocks significant financial benefits for IMAX while offering IMAX China investors a meaningful premium to current market prices,” said Rich Gelfond, CEO of IMAX Corporation. “The public listing of IMAX China raised capital to help fuel a period of tremendous growth for IMAX in China, and this transaction has the potential to usher in a new era of expansion for our brand and technology in this thriving market for entertainment.”
The deal comes as Imax continues its strategy to diversify the offerings it presents on its extra-large format screens around the world, with a growing focus on local-language titles to accompany Hollywood films like “Guardians of the Galaxy Vol. 3” and “Oppenheimer.”
That diversification has particularly paid off in China. Though Imax only accounts for 1% of the screens in the country, those auditoriums were packed during the highest grossing Lunar New Year period in box office history, pushing Imax to its best ever first quarter in global grosses.
Upon completion of the transaction, Daniel Manwaring will continue as Imax China’s CEO, reporting to Gelfond and overseeing all local business functions from the company’s Shanghai headquarters.
