SK Hynix, a key supplier of high-bandwidth memory (HBM) chips for AI giant Nvidia, successfully raised $26.5 billion in its U.S. share offering, marking the largest-ever listing by a foreign company in the United States. The South Korean chipmaker priced 177.9 million American depositary shares (ADRs) at $149 each. This offering was met with strong investor demand, reportedly seven times greater than the number of available shares, which allowed the company to charge a 2.9% premium over its current stock price in Seoul, a rare occurrence for such a large offering.
Shares of SK Hynix surged as much as 17% on Friday during their first day of trading on the Nasdaq under the ticker "SKHY." The $26.5 billion raised places this offering as the second-biggest share sale in history, surpassing Saudi Aramco's $25.6 billion IPO in 2019, though behind SpaceX's $85.7 billion listing. The proceeds from this historic offering are earmarked to fund the construction of new fabrication plants and the purchase of advanced equipment necessary to expand its production capacity, particularly for HBM chips.
This U.S. listing is also strategically important for SK Hynix, aiming to broaden its shareholder base and narrow the valuation gap with its U.S.-listed rival, Micron Technology. Despite SK Hynix leading Micron in market share for key memory product segments and being a dominant supplier of HBM chips, Micron often trades at a higher forward earnings multiple. For example, Micron's stock has a 12-month forward price-to-earnings ratio of 6.66 times, compared to SK Hynix's 5.5 times. Analysts suggest that the successful offering, despite some profit-taking in the Korean market, could help bridge this disparity by making SK Hynix shares more accessible to global investors.
While SK Hynix shares on the Korean bourse had been up more than 240% year-to-date against a roughly 80% increase for the KOSPI, the stock saw a temporary dip of over 7% earlier in the week prior to the listing, which analysts attributed to profit-taking rather than market disappointment. The listing is expected to attract more global investors, including long-only funds, technology-focused funds, sovereign wealth funds, and Asia-focused investors, providing greater flexibility for future capital raising and enhancing the company's global presence.
