SK Hynix successfully raised $26.5 billion in its American Depositary Receipt (ADR) offering on the Nasdaq, making it the largest ever U.S. listing by a foreign company and the second-biggest IPO in U.S. market history, behind SpaceX. The South Korean chipmaker sold 177.9 million ADRs at $149 each, with each ADR representing one-tenth of a common share traded in Seoul. The offering was priced at a premium of about 2.7% to 2.9% over SK Hynix's recent trading prices in Korea, an unusual move for large equity offerings which are typically discounted to attract investors. Demand for the offering was exceptionally strong, with orders reportedly more than seven times the number of shares available, highlighting investor appetite for companies central to the AI supply chain.
The proceeds from this substantial offering are earmarked for significant expansion in production capacity, particularly for high-bandwidth memory (HBM) chips which are crucial components for Nvidia’s artificial intelligence accelerators. SK Hynix plans to use the funds to build new fabrication plants, including the first one at the Yongin semiconductor cluster, and the P&T7 advanced packaging plant in Cheongju, along with purchasing manufacturing equipment. The company has explicitly stated that the capital will help meet the surging demand for advanced memory chips driven by the global race to build AI infrastructure.
The U.S. listing is also strategically important for SK Hynix, aiming to broaden its shareholder base and address a valuation gap compared to its U.S. rival, Micron Technology. Despite leading the global HBM market and having a stronger position in DRAM market share and operating profit than Micron, SK Hynix has historically traded at a lower price-to-earnings ratio. A Nasdaq presence is expected to make its shares more accessible to overseas investors and provide greater flexibility in raising capital in the long term. Initial trading on the Nasdaq began under the ticker "SKHYV" with regular trading expected to start under "SKHY."
