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Theater owner Imax ends hunt for a buyer

After a nine-month effort, the firm says it failed to obtain an offer at an acceptable price.

December 16, 2006|Claire Hoffman | Times Staff Writer

Mega-movie-screen theater operator Imax Corp. said Friday that it was taking itself off the market after a fruitless nine-month search for a buyer.

The Canadian company, which is operating under the cloud of an informal Securities and Exchange Commission inquiry and shareholder lawsuits related to how it has booked revenue, said it decided that expanding on its own was in the best interest of its shareholders.

"While Imax received interest from multiple parties in our process of exploring a potential sale or merger of the company, none ultimately indicated a willingness to acquire the company at an acceptable valuation," Richard L. Gelfond and Bradley J. Wechsler, Imax's co-chairmen, said in a statement.

Imax, whose theaters feature ultra-crisp images and booming sound, has been struggling as conventional cinemas have closed the quality gap. Imax also has been burdened by the high costs of its specialized equipment and prints.

The company began seeking a buyer in March, saying it had received some unsolicited inquiries. Imax hired investment banks Allen & Co. and UBS to handle the process.

Since it was founded in 1967, the company has become the leader in giant-screen cinema, with more than 282 theaters in 40 countries. Last year it had $145 million in revenue.

The animated "Happy Feet" has brought the company some relief, with Imax theaters grossing nearly $10 million from the Warner Bros. film.

Some saw Friday's news as the start of a new chapter for the theater owner, which has said it plans to roll out a new digital projection system by 2008.

"When companies are up for sale, they kind of lose focus," said Paul Dergarabedian founder of Media by Numbers, a box-office tracking company. "Now Imax can concentrate on the business of doing all the things they've wanted to do."

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claire.hoffman@latimes.com

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