IMAX's China Move Hits A Snag: Acquisition Proposal Fails To Pass Vote

IMAX Corporation IMAX has confirmed that its proposal to acquire IMAX China's outstanding 96.3 million shares will not proceed following a vote by IMAX China shareholders.

At the Extraordinary General Meeting (EGM) of IMAX China shareholders held October 9 EST/October 10 HKT, 70% of the shares voted were in favor of the proposed transaction.

However, the votes against the transaction were more than the 10% threshold required by Hong Kong law to defeat a privatization transaction. 

Overall, 61% of the total disinterested shares of IMAX China common stock were voted.

IMAX China is a Hong Kong-listed subsidiary established by IMAX to oversee its business in Greater China.

"Even though our proposal received the vast majority of votes cast, and support from both leading independent proxy advisory firms, the vote did not achieve the threshold needed for approval," said CEO Rich Gelfond.

"Furthermore, we will explore opportunities to deploy the incremental capital intended for this transaction through alternate means of creating shareholder value, such as share repurchases of IMAX Corporation stock."

Also Read: IMAX's Remarkable Recovery - 3Q Box Office Earnings Highlight Strong Growth

Price Action: IMAX shares are trading lower by 1.59% at $19.14 on the last check Tuesday.