Imax plans new theatres in China
Fourteen locations to anchor malls across country
Big-screen movie company Imax Corp. has signed a deal to open 14 of its laser theatres in China, a country that has become essential to the success of blockbuster films.
Imax signed a deal with Wanying Cinema Line, a subsidiary of a major state-owned developer, which will use the theatres to anchor shopping malls across the country, the company said Tuesday. The first of the new theatres open Saturday in two cities, Chongqing and Taiyuan, with the rest expected to open by the end of 2021.
China is important to U.S. entertainment companies as the audience for theatrical movies there continues to grow. The Chinese box office hit a record $7.9 billion in 2017 and is on pace to overtake the U.S. and Canada as the world’s largest film market by 2020, according to analysts.
China’s regulatory crackdown on major overseas investments in entertainment and other industries has made Hollywood executives increasingly wary of doing business with China.
But the Imax deal is different because it could serve the government’s interests by promoting commercial real estate development in the country.
“This is not a passive investment in an overseas entity,” said Imax chief executive Rich Gelfond. “This is an operating business in China that is going to be used for Chinese consumers.”
Imax — a Canadian corporation with offices in New York, Toronto and Los Angeles — has taken pains to crack the Chinese market in recent years. Its Shanghai subsidiary Imax China went public on the Hong Kong Stock Exchange in 2015. But Imax China’s stock flagged as China’s box office slumped in 2016 and audiences began to increasingly favour local-language movies, rather than the latest U.S. studio imports.
Imax has adapted by putting more Chinese-language movies in its theatres. The strategy appears to be working. Imax’s Chinese theatres generated $190 million in box office receipts in the first six months of 2018, up 13 per cent from the comparable period last year.