The demand for IMAX China shares has not met expectations, according to a filing on Wednesday. (Photo : Reuters)
With the aim of benefiting from the booming film industry in China, the world's second largest film market, IMAX China Holding, Inc., has recently filed for a Hong Kong IPO.
The listing, with an undisclosed amount, intends to gather funds for the entertainment giant's expansion.
IMAX China's IPO would be the first, since 2011, by a prime international brand in the Chinese autonomous region. Before this, companies like MGM China Holdings, Samsonite International SA and Prada Spa were opened in the city.
Screen movie theater equipment maker IMAX Corp. majorly owns the firm with an 80 percent stake after selling the other 20 percent to two private equity firms, CMC Capital Partners and FountainVest Partners, in 2014.
IMAX China also has strong ties with China's biggest movie chain, Wanda Cinema, which comprises half of IMAX theaters in the country, tallying up to 239, and about a quarter of the firm's revenue.
Since Wanda Cinema Line Corp. sought for a Shenzhen IPO listing early in January, its shares have increased by almost nine-fold.
According to IMAX China, the country's film industry has grown for about an average of 31 percent year-on-year from 2010 to 2014. For the next four years, the growth rate is expected to accelerate to about 35.2 percent.
Driven by rising urban populace and increasing disposable incomes, the boom could propel China's movie market and even surpass the U.S.' in 2017.
Predictions have surfaced that China could reach an $11.7-billion revenue in 2017, compared with the U.S.' $11.3 billion. The current largest film market in the world has posted a meager 0.5-percent annual growth for the past years.
As of its 2014 profit, IMAX China has listed a $22.6-million figure out of its $78.2-million revenue. In the previous year, the firm reached a $17.4-million profit and $55.9-million revenue marks.
IMAX China Holding, Inc.'s Hong Kong IPO listing is set to contribute increased profit and revenue statistics to the firm, which currently operates in Chinese mainland, Hong Kong and Taiwan.
