In one of the largest deals in its history, Imax has signed an agreement to supply 40 new theaters in China to Guangzhou JinYi Media Corp. Making the agreement more significant, the deal is struck on full revenue-sharing terms.
The new theaters will be added to existing cinema projects and be largely installed by 2018 in locations stretching from the major metropolises to “tier four” cities, including Huaihua (Hunan Province) and Deyang (Sichuan.) The last ones will be completed by 2020. The order will increase JinYi’s total to 60 Imax theaters.
JinYi is one of the largest exhibition companies in China, currently with 1,731 screens in 325 subsidiary and affiliated theaters across 21 provinces and four municipalities. Following the deal, JinYi is now the third-largest Imax theater operator in China and internationally.
Imax, which also operates the listed Imax China subsidiary, has grown in the country through different business models. It is increasingly shifting to the full revenue share model, which means it can more fully participate in the growth of the Chinese box office and growing attendance frequency.
“We will help meet the strong consumer demand for cinema-going in China where Imax remains an affordable, yet differentiated luxury,” said Imax Corp. CEO, Richard L. Gelfond, in a statement. “We have set a target of 1,000 theaters in China. With over 300 theaters open and – including this deal and a 10-theater deal announced earlier this year – an additional 270 in backlog, we are just beginning to tap China’s full potential.”
“Driven by the dramatic growth in the Chinese exhibition market, we are embarking on an aggressive expansion of our circuit. Mall developers recognize the power of the Imax brand to attract consumers and with Imax as an anchor entertainment attraction, we were able to secure locations in our desired complexes,” said Leo Li, CEO Guangzhou JinYi Media Corporation in a statement.