Iwerks Entertainment Inc., a maker of giant-screen theaters and theme park attractions, said Tuesday it will be acquired by a Canadian company for about $2.2 million in cash.
Although the value of the deal is small, Burbank-based Iwerks has been an influential company in the theme park and attraction industry, supplying the 3-D projection system used in the elaborate Terminator rides at Universal Studios parks in Hollywood and Florida.
Founded by the son of the animator who helped Walt Disney design the Mickey Mouse character, it also is the second-largest maker of large-screen, or 70-millimeter, theaters behind Toronto-based Imax Corp.
SimEx Inc., a Toronto-based simulator-ride company, will acquire Iwerks for 63 cents a share, which is more than double the Burbank-based company's closing price of 25 cents on Monday. On Tuesday, Iwerks closed up 19 cents at 44 cents in over-the-counter trading. Still, that's far from a one-time high of $120 a share, adjusted for a reverse stock split. The company went public in 1993. The acquisition is expected to close by June.
The deal gives SimEx access to Iwerks' simulator technology and its large-screen theater systems, said Michael Needham, a former venture capitalist and SimEx chief executive.
Large screens are taking on increasing importance in the theme park industry because they can supply a variety of thrills and cost less to update or change than traditional bricks-and-mortar theme park attractions.
Just last month Disney opened Soarin' Over California, an attraction at its new California Adventure theme park in Anaheim that uses large-screen technology to simulate a hang glider's flight. Disney planners are working on developing new versions of the ride for the company's other parks.
But where Disney will spend tens of millions of dollars on attractions, "the trick is to produce something that is financially sensible for the smaller amusement parks, science centers, zoos and other attractions we work with," Needham said.
A typical SimEx attraction--such as the Virtual Voyages ride it built for the Ruben H. Fleet Science Center at San Diego's Balboa Park--cost $1 million to $2 million, Needham said.
The merger also gives SimEx access to complimentary simulator technology. Iwerks' small systems are based on pods of seats that are programmed to move in tandem with film on the simulator screen. In the SimEx systems, the entire theater capsule moves.
