South Korean chipmaker SK Hynix intends to price its American Depository Receipts at $149 yesterday to raise about $26.5 billion, a person familiar with the matter said.
The share sale decision comes as the company leverages its position as the leading supplier of high-bandwidth memory chips, a critical component for the advanced processors powering global artificial intelligence systems.
Demand for SK Hynix’s US share sale was more than seven times available shares, another person familiar with the matter said, underscoring huge investor appetite for a pivotal company in the AI supply chain.
SK Hynix declined to comment on the pricing and the demand for shares. The person declined to be identified as details of the share sale were confidential.
It will start trading on Friday under the ticker symbol “SKHY” on Nasdaq. It had referenced a per share price of 242,500 won per ADR, based on the July 3 closing price in Seoul. Yesterday, the stock closed at 2,186,000 won and ten ADRs represent one common share.
The offering from the South Korean chipmaker will finance new factories and equipment to meet surging AI chip demand.
In addition to bringing in funds, SK Hynix’s US listing is expected to help narrow its valuation gap with US rival Micron, which despite having less market share in key memory products, has benefited from direct access to the world’s largest pool of investors.
Micron trades at a 12-month forward price-to-earnings ratio of 6.66 times versus SK Hynix’s 5.5 times.
“Meanwhile, SK Hynix continues to battle its domestic rival, Samsung, for chip supremacy. Samsung Electronics remains the world’s largest memory chipmaker by volume.
SK Hynix has made its fortune by becoming the most sought-after supplier of high-bandwidth memory chips, a culmination of 14 years of bets that brought it scepticism and scorn but ultimately put it at the centre of the global AI gold rush.
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