Late this year, Imax announced two big movie releases in China: Dragon Blade, starring Jackie Chan, promising a “thrilling story of heroism, friendship and betrayal, which has never before been depicted on film,” and John Woo’s The Crossing, a two-part historical epic about the establishment of the People’s Republic of China. For Imax, the blockbuster releases are evidence that its long-simmering China play is finally coming to fruition.
Richard Gelfond began visiting China in the ’90s, meeting with government and film industry officials to learn what it might take for the company to succeed there. What the CEO heard was that Imax should screen domestic films, export Chinese cinema abroad and build theatres in third-tier cities, not just the metropolises. Imax didn’t open its first commercial theatre in China until 2004. A decade later, the company has built more than 170 theatres in the country and plans to add 246 more over the next five years. (For comparison, there are currently 340 Imax screens in North America.)
Imax also struck a major agreement this year that paves the way for the next phase of its ambitious growth plans. In April, the company agreed to sell 20% of its Chinese subsidiary to local investors for $80 million. The deal, which Gelfond says was three years in the making, was not about money but strategy. One of the investors, China Media Capital (CMC), is a huge player in the nation’s incredibly complex domestic movie business. CMC’s expertise and connections will open up expansion opportunities and allow for more partnerships with local film studios. It also increases Imax’s chances of an IPO of its Chinese subsidiary in the near future.
“We feel that U.S. investors don’t fully understand the potential of the Chinese film market,” Gelfond told the Wall Street Journal in 2014. Easy for him to say—he’s been studying it for 15 years.