SK Hynix Inc has received markedly strong investor interest for its U.S. ADR offering, with demand reported to be several times the size of the securities available, underscoring robust appetite for the memory-chip maker ahead of pricing.
The company began marketing 177.9 million American depositary receipts on Monday. Using the prior Friday's closing price in Seoul as a reference point, that book equates to an offering valued at about $28 billion - positioning the sale to become the largest-ever U.S. listing by a foreign issuer if it proceeds as priced.
Each ADR equals one-tenth of a common share, and the sale represents about 2.5% of SK Hynix's market capitalization. The stock has experienced a substantial run-up this year, more than tripling as demand for high-bandwidth memory chips used in artificial intelligence servers supported a sharp rally.
Participation in the company's investor outreach was broad: roughly 1,000 institutional investors joined management during the roadshow, and global long-only funds and technology-focused investors were reported to be among the active bidders. The offering was described as attracting robust demand ahead of its expected pricing on Thursday.
Despite the strong order flow for the ADRs, SK Hynix's shares in Seoul fell nearly 3% on the trading day in question, though that decline was a smaller move than the broader KOSPI index, which dropped more than 5%.
The ADRs are scheduled to be priced on Thursday and to commence trading on the Nasdaq Global Select Market on Friday. Market mechanics may influence relative pricing between the U.S. and Seoul listings: restrictions on converting Seoul-listed shares into ADRs could limit arbitrage activity and, as a result, create the possibility that U.S.-listed ADRs trade at a premium to the home-market shares.
The transaction is being led by four banks: Bank of America, Citigroup, Goldman Sachs and JPMorgan Chase. Market participants will watch the pricing and early trading closely to see how the ADRs perform against the backdrop of recent volatility in Korean equities.
Market context: The offering comes as SK Hynix benefits from strong demand for AI-related memory chips, which has driven a significant re-rating of the stock this year.
Near-term timetable: ADRs marketed starting Monday; pricing expected Thursday; Nasdaq Global Select Market trading due to begin Friday.