Imax ramping up in China

Wanda Cinemas, China's largest theater chain, has chosen Canada's Imax Corp. to build 75 giant screens in its multiplexes over the next three years.
imax

Under orders from Beijing to help expand China’s cultural sector, Wanda Cinemas, the country’s largest theater chain, has chosen Canada’s Imax Corp. to build 75 giant screens in its multiplexes over the next three years.

The $100 million deal will see the launch of Imax China to oversee the Toronto-based company’s rapid expansion in that burgeoning Asian market.

Imax will run the theatres with Wanda as joint ventures, contributing its giant screen, projector and sound system and sharing the risk and box office revenue with its Chinese partner.

That digital theatre technology, built and shipped out of Imax’s west Toronto headquarters, will mean a boost in jobs and prospects for the iconic Canadian media player.

The Wanda deal also aims to create more recurring revenue for Imax as it continues to expand beyond its North American base to build out its international theatre network.

“Wanda Cinema Line is the largest theatre operator in China and is on a very aggressive build-out trajectory,” Imax CEO Richard Gelfond said Thursday.

“Wanda’s theatres, including their Imax theatres, have been very successful, and we believe this large rollout of Imax theatres will be a very successful arrangement for both companies,” he added.

Total movie ticket sales in China in 2010 rose 64% to $1.5 billion, about one-third larger than the Canadian market.

Given its huge population, Imax has spent a decade getting in on the ground floor of a Chinese theatrical movie market about to explode in scale and quality.

“China has been our fastest-growing market in the world and extremely successful on a per-screen basis,” Gelfond said.

“We have been working for almost a year on a new corporate and legal structure to operate in China to reflect our expanding business in the region and facilitate our transition to the increased use of a joint- revenue-sharing model. This agreement with Wanda gives us significant momentum to expand our network in China,” he added.