Record $26.5bn US IPO for SK Hynix as Washington eyes Korean fabs
South Korean chipmaker SK Hynix has raised $26.5 billion in the largest foreign IPO in US history, a deal that highlights the strategic value of AI memory as Washington pressures Asian suppliers to shift production stateside.
SK Hynix sold 177.9 million American depositary shares at $149 each, raising $26.5 billion and surpassing Alibaba’s 2014 record to become the largest-ever US market debut by a non-American company. The stock opened 14% above its offering price on the Nasdaq on Friday under a temporary ticker, with regular trading scheduled to begin on Monday.
The ADRs are structured to let US investors buy in at roughly a tenth of the cost of a full share in Seoul. Despite this fractional pricing, demand reportedly exceeded available shares by more than seven times. Investors accepted a 2.7% premium to the company's three-day average on the Korea Stock Exchange, a striking departure from market norms.
South Korean companies typically trade at a valuation gap known as the "Korea Discount." Investors have historically justified this by pointing to complex corporate governance structures, low shareholder returns, regulatory uncertainty, and the persistent geopolitical risks tied to North Korea. SK Hynix has clearly bypassed this penalty, and the reason lies entirely in its product portfolio.
The company manufactures high-bandwidth memory (HBM), a key component for artificial intelligence graphics processing units. Crucially, Nvidia relies on SK Hynix as a primary supplier for these chips. To capitalize on the worldwide memory shortage caused by AI, the company will direct its new capital toward a new domestic fab, a new packaging facility in South Korea, and EUV scanners required for next-generation manufacturing.
For global markets, however, the ultimate destination of future manufacturing capacity is the more pressing question. US Commerce Secretary Howard Lutnick used a Micron event on Thursday to announce he is already in talks with SK Hynix and Samsung about building new factories on American soil. The stated goal is to break South Korea's dominant position in this critical technology sector.
This pressure creates a delicate balancing act for the industry. The two Korean chipmakers only recently pledged more than $550 billion combined for new manufacturing investments back home. At the same time, US rival Micron has firmly aligned with Washington's objectives, announcing a $250 billion investment in domestic manufacturing that it claims will create over 90,000 American jobs.
