Letko Brosseau Intends to Vote AGAINST IMAX Corporation's Proposal to Take IMAX China Holding, Inc Private

MONTREAL, Sept. 22, 2023 /CNW/ - Letko, Brosseau & Associates Inc., ("Letko Brosseau"), an independent investment manager that exercises investment control or direction over approximately 1.7% of the outstanding shares of IMAX China Holding, Inc ("IMAX China" or the "Company"), today announced its intention to vote AGAINST the proposed going private transaction of IMAX China by IMAX Corporation, which currently owns approximately 71.6% of IMAX China shares outstanding.

IMAX China is a leading cinematic technology provider, the exclusive licensee of the IMAX brand and technology and the sole platform for the release of IMAX format films in Greater China. On July 13, 2023, minority shareholders received a proposal from majority shareholder IMAX corporation to acquire the remaining equity of IMAX China for a consideration of HK$10.00 per share.

Based on Letko Brosseau's own analysis, the proposed offer significantly undervalues the Company and unjustifiably benefits IMAX Corporation at the expense of minority investors. The timing of the offer is opportunistic and comes as the Company is beginning to emerge from the global COVID-19 pandemic that has kept a significant portion of its theatres closed over extended periods of time from 2020 to 2022.

• The 39.5% premium to the prior closing price is based on a very depressed share price (HK$7.17). At HK$10 per share, the offer is less than 60% of what the shares were trading before the global pandemic. The offer does not reflect IMAX China's historical level of profitability and its potential for strong earnings growth and cash flow generation going forward.
• The announcement came just days prior to the release of IMAX China's First Half 2023 results that highlighted the recent reopening of all theatres as well as a significant recovery of revenue (up 39%) and adjusted profit (up 6x) on a year over year basis.
• It values the Company at about 9x 2024 adjusted earnings¹, which is less than half of the Company's historical valuation and is unjustifiably low in our view given the strong recovery potential.

To protect the value of our investment, Letko Brosseau intends to vote against the proposed going private transaction and urges all other minority shareholders to carefully consider the merits of this offer.

______________________________
^1	Source: FactSet (www.factset.com) financial data and analytics

Letko, Brosseau & Associates Inc. is an independent investment manager founded in 1987, with offices in Montreal, Toronto, and Calgary. The firm manages assets for both institutional investors and private clients.

FORWARD-LOOKING STATEMENTS

Certain information contained in this press release may constitute forward-looking statements. Forward-looking statements may include estimates, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although Letko Brosseau believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. These statements are subject to certain risks and uncertainties and may be based on assumptions that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements. Letko Brosseau's forward-looking statements are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained in this press release are made as of the date hereof and Letko Brosseau does not assume any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise unless expressly required by applicable securities laws. 

SOURCE Letko, Brosseau & Associates Inc.

Peter Letko, Senior Vice President, [phone], [email protected]; Daniel Brosseau, President, [phone], [email protected]; Rohit Khuller, Vice President, Investment Management, [phone], [email protected]