SK Hynix is reviewing a potential U.S. initial public offering for its American NAND Flash subsidiary Solidigm, and the plan is already weighing on the group’s listed affiliates as investors question the ownership structure behind the deal.
Solidigm may seek a U.S. listing as early as next year
According to Bloomberg, Solidigm could go public in the United States as early as next year, with a valuation that may reach $100 billion.
The report hit SK-related stocks in South Korea. SK Hynix fell 5%, its biggest one-day decline in nearly two weeks. SK Square, its largest shareholder, dropped more than 8%, while SK Inc., the holding entity, lost more than 6%. The selloff reflected investor concern over how a separate listing could affect pricing and capital allocation within the group.
Layered ownership structure draws governance scrutiny
The Korea Corporate Governance Forum, a nonprofit investment-focused organization, urged SK Hynix in August to drop the plan.
The group said SK Hynix holds Solidigm indirectly through its U.S. subsidiary AI Company, which makes Solidigm a sub-subsidiary inside the broader SK structure. If Solidigm is listed on its own, that would deepen what critics describe as a pyramid-style ownership arrangement and add to market concern over duplicate listings and dilution of shareholder rights.
Valuation and use of proceeds are central questions
Jung In Yun, chief executive of Fibonacci Asset Management Global, said the market should watch the situation carefully rather than overreact.
He said a U.S. listing could help unlock Solidigm’s asset value and raise money for capacity expansion. At the same time, existing SK Hynix shareholders would give up part of the unit’s future profit stream. In his view, the key issue is the final offering valuation and how the proceeds are deployed. Selling a minority stake at an attractive price could create value, but a large earnings dilution without a clear return on investment would justify investor concern.
Oil-driven risk aversion adds pressure to the sector
The pressure on chip stocks was not limited to the Solidigm listing review and ownership questions. Broader market moves also played a role.
Recent gains in international oil prices have raised concern about inflation and higher costs, pushing investors toward a risk-off stance. In that setting, weakness spread beyond SK Hynix, with major Korean semiconductor names including Samsung Electronics also trading lower.