TORONTO — Large-format film company Imax has signed a multimillion-dollar deal with United Cinemas International to open 10 Imax 3D theaters across the U.K., Europe, the Far East and South America, the company announced Wednesday.
The deal, which industry sources say is worth about $25 million, is the largest international agreement Imax has entered into.
“About a year ago, we said we were going to take our cinema exhibitor strategy and implement it in Europe,” said Imax co-CEO Rich Gelfond. “This is the latest and the largest success coming out of that.”
Eight UCI-owned Imax 3D theaters will open in multiplexes in the U.K., Europe, the Far East and South America over the next five years. (The other two are recently-opened UCI-owned Imax 3D theaters in Sapporo, Japan, and Manchester, England.) The terms of the deal also allow for the number of Imax theaters to expand to 20, noted Gelfond.
Wall Street reacted favorably to the deal. “We think there’s more opportunity in the international markets because the buildout is just commencing,” said Marina Jacobson, a New York-based equity analyst with Bear Stearns. “The U.S. in terms of cinema operations is fairly mature, whereas in the overseas markets there’s a lot of opportunity, and Imax is riding that wave.”
“For Imax at this stage in our growth, the really important thing is to get our brand out, particularly in new markets,” Gelfond said. “And the opportunity to launch our brand with a high-quality exhibitor like UCI makes sense from an exhibitor’s point of view.”
UCI, a joint venture of Viacom subsidiary Paramount Pictures and Seagram’s Universal Studios, is the largest cinema exhibition group in Europe.
The deal complements Imax’s current relationship with both those companies. Imax also has theater deals with Viacom subsid Famous Players and Loews Theatres, which is partly owned by Universal.
UCI president Joe Peixoto was instrumental in facilitating the deal, said Gelfond, because Peixoto was president of Canuck exhibitor Famous Players when a 10-theater deal was signed in 1996.