Imax Jumps on 100 Theatre Deal With AMC

Shares of Imax (IMAX) surged Friday after it announced it had reached a deal with AMC to install 100 Imax screens in AMC's theatres by 2010. The deal is actually a joint-venture, in which AMC will pay for costs associated with converting standard movie theatres into Imax theatres, Imax will provide the projection system, and the two companies will share revenues from the movies. The deal will more than double the amount of Imax theatres in North America, and will last for at least seven years. "It's a game-changer for Imax from several perspectives," Richard Gelfond, co-chief executive of Imax. "Imax has been a great consumer proposition for almost 40 years, but we've struggled at times to find a footprint to create the optimal business model. And I think a combination of our digital transition and our JV model turn Imax not only into a great consumer experience, but a really strong business proposition." Shares of Imax traded 57.5% higher to $7.31 in late morning action.

Sources: Wall Street Journal, MarketWatch

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Comments

[vboring]

imax screens are terrible to watch normal movies on. you end up either sitting so far away that it looks like a normal screen or you are close enough that you have to keep looking back and forth to follow what is going on.

plus, it seems unlikely that many filmakers will switch to imax equipment, so the theatres will project standard quality films on bigger screens, resulting in grainy, blurry images.