SK hynix halts review of Solidigm's US stock market listing

Solidigm, SK hynix’s NAND flash memory subsidiary, has decided to halt its review of potential pre-initial public offering (IPO) fundraising and IPO options, citing volatile capital markets and recent trends in semiconductor stock prices, the chip giant said Friday.

The company was established in the United States following SK hynix’s $9 billion acquisition of Intel’s NAND flash memory business.

"While SK hynix and Solidigm continue to deliver solid business performance, financial market volatility has increased, contributing to a broader correction in semiconductor stocks," SK hynix said in a press statement.

"After comprehensively assessing these business conditions, Solidigm has decided to discontinue its review of potential pre-IPO and IPO options."

Reports circulated that Solidigm was considering a U.S. IPO as early as next year that could value the company at up to $150 billion, with the listing seen as a way to secure funding for U.S. production facilities and technology development amid growing demand for enterprise solid-state drives for artificial intelligence data centers.

However, the potential listing had raised concerns over its impact on SK hynix's shareholder value, as well as regulatory scrutiny over the possibility of a subsidiary listing overseas while its parent company remains listed in Korea.

Amid mounting controversy over Solidigm’s potential dual listing, financial authorities warned that the plan would face regulatory checks.

Earlier this week, Financial Supervisory Service (FSS) Gov. Lee Chan-jin said both the FSS and the Financial Services Commission viewed Solidigm as subject to restrictions on duplicate listings.

However, SK hynix said the decision does not reflect any change in the company’s growth prospects or investment needs.

“Rather, it reflects a reassessment of whether an IPO would be the most beneficial option for SK hynix and its existing shareholders under current market conditions," it added.

SK hynix said raising external capital through an IPO could have improved its consolidated cash flow, helping fund facility investments while supporting shareholder returns through dividends, share buybacks and share cancellations. It also said an IPO could have allowed the market to better recognize Solidigm’s growth potential, which it believes is not adequately reflected in SK hynix’s current corporate value.

Expanding Solidigm’s production capacity and strengthening its competitiveness remain key priorities, SK hynix said, adding that it would continue to assess investment timing, scale and financing options to support the subsidiary’s growth and enhance value for existing shareholders.