SK Hynix announces a $29 billion listing in the US, which could surpass all previous ADR transactions.

      SK Hynix has submitted a request to raise up to 45.45 trillion won, approximately $29 billion, through a listing of American depositary receipts on Nasdaq, as disclosed in a regulatory filing on Wednesday. The company has provisionally scheduled July 10 for its market debut and plans to issue 17.79 million new shares to support the receipts, with 10 ADRs corresponding to one common share.

      If the offering reaches the upper limit of the proposed range, it would become the largest ADR offering ever, surpassing the $21.8 billion raised by Alibaba during its 2014 listing in New York. However, there is a notable detail regarding the use of the funds. SK Hynix stated that the entire amount raised will be allocated specifically for capacity expansion, which includes a chip fabrication plant in Yongin, an advanced packaging facility in Cheongju, and equipment acquisitions such as extreme ultraviolet scanners, which are lithography machines essential for printing minute details on wafers. None of the funds will benefit shareholders or be used to pay down debt.

      For a company with a full order book, this intention appears less like a financial reserve and more akin to a financial obligation. SK Hynix is the second-largest memory manufacturer globally and the leading provider of high-bandwidth memory (HBM), which is the stacked DRAM utilized alongside Nvidia’s accelerators to supply data. This substantial market position, rather than a general recovery in commodity chips, is what has influenced the stock price.

      Industry projections suggest that the company is responsible for approximately 60 to 70 percent of the HBM4 volume allocated to Nvidia's Vera Rubin platform, well ahead of competitors Samsung and Micron. A recent multi-year agreement with Nvidia established the company as a co-development partner rather than merely a supplier.

      The size of the intended raise has significantly increased in a short period. Initially, when the idea first emerged, estimates ranged from $10 billion to $14 billion for a U.S. listing as early as August. By June 16, bankers were estimating as high as 40 trillion won, around $26.5 billion. The current filing of 45.45 trillion won is even higher and the timeline has been expedited to July.

      The underwriting for the deal involves BofA Securities, Citigroup Global Markets, Goldman Sachs, and JP Morgan Securities. The listing follows shortly after a significant milestone that provided pricing leverage. On June 22, SK Hynix surpassed Samsung in market capitalization, becoming South Korea’s most valuable publicly traded company based on common stock, marking the first shift at the top of the Korea Exchange since Samsung claimed that title in November 2000.

      A month earlier, the company exceeded $1 trillion in market capitalization, becoming only the third chip company to achieve this, following Nvidia and TSMC. The rise behind these numbers has been rapid, with SK Hynix shares soaring several hundred percent over the past two years, and the company reported higher annual profit than Samsung for the first time in January.

      A Nasdaq listing offers international investors a means to participate in that growth without trading in Seoul and provides SK Hynix with funding for the fabs it has already committed to. However, the filing does not resolve the uncertainty that permeates each memory cycle, as the business is known for its cyclical nature, and the current upswing is being valued as if it will continue indefinitely. HBM capacity for 2026 is already sold out, and shortages are expected to persist into 2027. Nevertheless, SK Hynix is seeking funds to expand, anticipating demand that extends far beyond that.

      While the filing is a notable regulatory step, it does not finalize the transaction. The pricing, number of shares, and listing date remain subject to change, and the figures depend on an upcoming review by the U.S. Securities and Exchange Commission. If the deal is priced at the upper limit of its range on July 10, SK Hynix will achieve the largest ADR offering in history, but the more challenging forecast is how long the demand that justifies this offering will endure.