SK Hynix's Nasdaq IPO May Become Second Largest Ever, Raising $25.7 Billion

South Korean semiconductor giant SK Hynix is preparing a Nasdaq IPO that could become the second largest in history. According to MarketWatch, if underwriters Goldman Sachs, Citi, Bank of America, and JPMorgan price the offering based on the Seoul closing price, SK Hynix will raise approximately $25.7 billion. This would place it just behind SpaceX's $75 billion IPO last month and slightly above Saudi Aramco's $25.6 billion 2019 offering and Alibaba's $25 billion 2014 IPO. However, the amount is below SK Hynix's original target of $29 billion due to recent market declines in South Korea.

The company plans to sell 17.79 million new shares via American Depositary Receipts (ADRs) to broaden its investor base and facilitate U.S. investor access to a leading beneficiary of the AI revolution. Bloomberg reports the IPO has attracted seven times oversubscription from institutional investors, including global funds and sovereign wealth funds. Pricing details are expected later today. Vee-Sern Ling, managing partner at Union Bancaire Privée, told Bloomberg that strong investor interest reflects robust demand for memory chips despite recent market jitters, with the main debate focusing on long-term earnings stability and valuation.

SK Hynix has emerged as a key player in the global AI hardware race, particularly due to its advanced High Bandwidth Memory (HBM) chips, critical for AI accelerators used by companies like Nvidia and Google. Demand for these chips has surged alongside the expansion of large AI models and data centers. The company has outperformed major competitors Samsung Electronics and Micron Technology, becoming a vital chip supplier for the AI industry. Many investors view SK Hynix as a direct beneficiary of massive technology investments in advanced computing infrastructure.

Each SK Hynix ADR represents one-tenth of a regular share. Based on the Seoul stock price of 2.076 million won ($1,380) per share, Bloomberg estimates the U.S. offering will raise about $24.5 billion. Despite strong demand, Bloomberg notes that high IPO interest does not guarantee sustained price gains, as seen with SpaceX’s stock, which recently closed at its lowest level since mid-June trading began.