SK Hynix is seeking new ways to finance its ambitious manufacturing goals. On Wednesday, the South Korean chipmaker confirmed it is actively considering a listing on the U.S. stock market. In a regulatory filing, the company stated it might issue American Depositary Receipts (ADRs) using its own treasury shares, though it noted that it has not finalized the plan.
The company needs a massive amount of cash to keep up with the global AI boom. SK Hynix recently finished a factory in Cheongju and is currently building a huge semiconductor cluster in Yongin. To fund these projects, the company says it will need approximately 600 trillion won ($408 billion) over the next few years.
Raising this capital is complicated due to strict ownership laws in Korea. The company’s parent firm, SK Square, must legally own at least 20 percent of SK Hynix. Issuing new shares to raise capital would dilute SK Square’s stake and violate that law. However, by selling “treasury shares”—stock the company already holds in its own vault—SK Hynix can raise funds without changing the ownership percentages.
Political pressure also plays a role in this decision. South Korean lawmakers are currently pushing a bill that would require companies to cancel (destroy) their treasury shares to improve shareholder value. By transferring these shares to a U.S. bank for an ADR listing, SK Hynix could put the assets to work before the government forces the company to delete them.
Wall Street analysts see potential in the move. Kim Sun-woo of Meritz Securities noted that an ADR listing could help SK Hynix join major U.S. semiconductor indexes alongside giants such as TSMC and ASML. This attracts more money from passive investment funds. Investors reacted positively to the news, pushing SK Hynix’s stock price up 3.71 percent to close at 587,000 won on Wednesday.
