Memory chip giant SK hynix has made history, pricing its highly anticipated Nasdaq offering of American Depositary Receipts (ADRs) at $149 each, valuing the landmark deal at approximately $26.5 billion.
The South Korean semiconductor powerhouse confirmed Friday that it will offer 177.9 million ADRs. Each ADR will represent one-tenth of a common share currently traded on the Seoul stock market.
Notably, this offer price signifies a remarkable roughly 2.9 percent premium over SK hynix’s closing price of 2.19 million won ($1,450) on the Korean stock market just a day prior, Thursday.
Such substantial equity offerings typically feature a discount to prevailing market prices, designed to attract investors. This makes the premium secured by the SK hynix deal exceptionally unusual. The company proudly stated that this marks the only premium-priced initial public offering (IPO) of its magnitude in the entire history of the U.S. market.
Market sources reveal overwhelming investor confidence, with orders during the rigorous book-building process exceeding seven times the total number of ADRs initially offered.
The robust demand emanated from a diverse and broad spectrum of institutional investors globally, including leading long-only funds, specialized technology-focused funds, prominent sovereign wealth funds, and key Asia-focused investors.
With a staggering valuation of $26.5 billion, this offering is poised to dramatically eclipse the $25 billion raised by Alibaba during its 2014 New York listing. SK hynix emphasized this achievement would solidify its position as the largest U.S. IPO ever conducted by a foreign company.
Furthermore, the company highlighted that this transaction also represents the largest ADR offering on record and stands as the second-biggest IPO in U.S. market history, trailing only SpaceX’s monumental approximate $85.7 billion offering.
Conditional trading for SK hynix on the Nasdaq is set to commence this Friday under the provisional ticker symbol “SKHYV.” Regular trading, utilizing the permanent ticker “SKHY,” is anticipated to begin on Monday, with the historic offering officially closing on Tuesday.
Leading financial institutions Bank of America, Citigroup, Goldman Sachs, and JPMorgan are collectively serving as the joint bookrunners for this groundbreaking offering.
In a significant event, SK Group Chairman Chey Tae-won and SK hynix CEO Kwak Noh-jung are slated to attend the prestigious opening-bell ceremony at the Nasdaq MarketSite in New York’s iconic Times Square this Friday.
yeeun
