SK hynix sets record with $26.5 billion Nasdaq offering
Seoul, July 10
South Korean memory chipmaker SK hynix raised approximately USD 26.5 billion in its Nasdaq listing after pricing its American depositary receipts at USD 149 each, marking the largest US initial public offering by a foreign corporation.
The deal bypassed the previous USD 25 billion foreign record established by Alibaba during its 2014 New York listing. As per Korea Herald, the transaction stands as the largest American depositary receipt offering on record and the second-biggest initial public offering in US market history.
Conditional trading on the Nasdaq begins Friday under the ticker symbol "SKHYV," with regular trading scheduled for Monday.
In a statement regarding the deal structure, SK hynix announced that it would offer 177.9 million American depositary receipts, with each receipt representing one-tenth of a common share traded in Seoul.
The transaction concluded with a 2.9 per cent premium to the closing price of 2.19 million won (USD 1,450) on the Korean stock market, breaking the standard industry practice of discounting large equity offerings to attract buyers.
The company stated that the transaction was the first US initial public offering of its kind to be priced at a premium. Market sources noted that overall orders throughout the book-building process exceeded the available receipts by more than seven times.
Citing a regulatory filing, the news report mentioned that the company plans to utilise the total proceeds to expand its production capacity to meet global artificial intelligence infrastructure demands. The capital will fund the first fabrication plant at the Yongin semiconductor cluster, the P&T7 advanced packaging plant in Cheongju, and additional manufacturing equipment purchases.
The company separately earmarked 11.9 trillion won (USD 8.5 billion) for extreme ultraviolet lithography equipment to be installed by the end of next year.
The listing is designed to expand corporate exposure among international market participants and minimise the valuation gaps that persist between regional competitors.
SK Group Chairman Chey Tae-won said in March that the ADR listing would give the company greater exposure to US and global shareholders and help make it "a more global company."
The newly issued shares represent roughly 2.5 per cent of the current outstanding stock count. SK hynix noted that the advantages of wider capital access would outweigh potential share dilution, with additional shareholder-return measures expected later this year.
— ANI
Reader Comments
It's impressive but also a bit concerning how much of the global semiconductor supply chain is concentrated in just a few companies. India needs to accelerate its own chip manufacturing ambitions or we'll always be dependent on imports. This is a wake-up call 🇮🇳
A premium IPO? That's very unusual. Usually these large deals are discounted to attract buyers. SK hynix must have some serious demand. AI chips are the new gold rush. I wonder how this affects Samsung and Micron's market positioning.
All this money for AI infrastructure... Meanwhile, India's semiconductor mission is still crawling. We have the talent, we have the market, but execution has been slow. Hope the government pushes harder on fab incentives. Otherwise, we'll miss this AI bus entirely 🚌
Amazing how SK hynix is investing heavily in EUV lithography. That's cutting-edge tech. The AI boom is real and it's reshaping global semiconductor supply chains. Could be good for India too if we position ourselves as an alternative manufacturing hub.
One point that's glossed over: issuing only 2.5% of shares to raise this much means existing shareholders are getting very rich from AI hype. It's good for the company but retail investors should be cautious - valuations are already sky-high in this sector.
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