(Yicai) Oct. 11 -- Shares of Imax China Holding dropped today after the shareholders of the Chinese arm of Canada's Imax Technology Network rejected a proposal to take the company private.

Imax China [HKG: 1970] was trading down 1.6 percent at HKD7.87 (USD1) as of 3.35 p.m. in Hong Kong today.

Over 10 percent of the shareholders voted against the privatization plan, which was thus rejected, Imax China announced yesterday. About 70 percent of the shareholders voted in favor.

"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 Rich Gelfond, chief executive officer of Imax. "While disappointing, the vote demonstrates that shareholders believe, as we do, that the future of Imax China is bright.

"We are committed to our business in China and our team will continue to create new growth opportunities for the Imax brand and technology in this vital market for blockbuster entertainment," Gelfond added. "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 stock."

Imax China was listed on the Hong Kong Stock Exchange in October 2015. Imax holds about 71.6 percent of Imax China.

According to a plan released on July 13, Imax intended to buy the remaining shares of Imax China it did not yet own at a price of HKD10 apiece, a premium of nearly 50 percent on the average trading price of the 30 days before the announcement but down 68 percent from its initial public offering price of HKD31.

The privatization aims to help make Imax China's operations more flexible to pursue new growth opportunities, introduce new Imax technologies, save financial costs, and downsize its structure, according to the announcement on July 13.

Imax China achieved revenue of USD45.3 million in the first half of the year, up 39 percent from a year earlier. Net profit jumped 18-fold to USD13.9 million in the period.

Editor: Futura Costaglione