SK hynix’s debut on the U.S. stock market has been met with overwhelming interest from Wall Street’s institutional investors, resulting in a highly successful launch.
Bloomberg reported on Wednesday that demand for SK hynix’s American Depositary Receipts (ADRs) surpassed the available supply by more than sevenfold.
According to sources close to the matter, a diverse range of investors, including global long-term investment funds, tech-focused funds, sovereign wealth funds, and global institutions specializing in Asian investments, placed substantial orders.
Major institutional investors such as Baillie Gifford, CQS Management, and Situational Awareness Partners reportedly expressed interest in acquiring up to 7 billion USD worth of ADRs in this offering.
SK hynix plans to issue 177.9 million ADRs, with each ADR representing one-tenth of a common share. The total offering size is estimated at approximately 24.5 billion USD, positioning it to become the second-largest U.S. stock market listing by a foreign company, trailing only Alibaba’s 25 billion USD initial public offering (IPO) in 2014.
However, insiders cautioned that the final offering size and terms could still change, as the book-building process is ongoing.
This offering comes amid a cooling of the recent AI semiconductor rally. SK hynix’s stock price dropped 5.7% the previous day and has corrected about 30% from its all-time high recorded in late June.
Nevertheless, the stock remains roughly triple its value from the beginning of the year. In the U.S., competitor Micron has also experienced increased stock volatility as the fervor for artificial intelligence (AI) investments has somewhat subsided.
Despite these market fluctuations, Bloomberg analysts suggest that global institutional investors have placed substantial orders, indicating strong confidence in the growth potential of the AI memory market, particularly in high-bandwidth memory (HBM).
The offering is jointly led by Bank of America, Citigroup, Goldman Sachs Group, Inc., and JPMorgan, with nine additional securities firms participating.
SK hynix’s ADRs are set to begin conditional trading on the Nasdaq Global Select Market under the ticker symbol SKHYV on July 10, before transitioning to SKHY for regular trading starting July 13.
