SK Hynix Plans $29.4 Billion U.S. Listing to Tap AI Demand

SK Hynix plans to raise up to 45 trillion won, or about $29.4 billion, through an American depositary receipt listing that would begin trading on July 10. The offering would be the largest U.S. listing by a Korean firm and the biggest ever conducted via ADRs, surpassing Alibaba's 2014 debut of $25 billion.

The company is one of the leading suppliers of high-bandwidth memory chips used in AI data centers. Surging demand for those chips has driven its Seoul-listed shares up roughly 306 percent this year and lifted its market value above $1.2 trillion.

The planned listing comes about two days after a Chosun media report from South Korea triggered a global sell-off in memory stocks and a 10 percent drop in the Kospi index. Retail investors in Korea had piled into chip trades, amplifying the earlier rally.

Bank of America, Goldman Sachs, and JPMorgan are leading the offering. The company said the move will give it access to a broader and more liquid U.S. investor base.

UBS analyst Nicolas Gaudois wrote that the size and timing are in line with investor expectations. He added that SK Hynix is expected to buy back shares to keep SK Square's ownership above 20 percent. CLSA analyst Sanjeev Rana said the U.S. listing will help boost liquidity and could propel a further rally if the shares trade at a multiple similar to Micron.

“If they can get at least a valuation multiple similar to Micron, for example, then the local shares also need to reflect that, so that kind of expectation is there." — Sanjeev Rana, CLSA analyst Pictet Asset Management analyst Jon Withaar noted that a large part of the motivation is the success of TSMC's ADR, which trades at a persistent premium to the Taiwan line and is readily accessed by global investors. Kevin Net, head of Asian equities at Financière de l'Echiquier, said the listing will help SK Hynix receive more funding for further investment and reduce its valuation discount to Micron.”