Solidigm U.S. IPO would face Korea split-listing rules, FSC says
The FSC says a potential U.S. initial public offering by SK hynix subsidiary Solidigm would trigger Korea’s split-listing rules and shareholder protection obligations.
Financial Services Commission (FSC) Chairman Lee Eog-weon answers lawmakers' questions during a parliamentary audit of the FSC, the Financial Supervisory Service and other financial authorities at the National Assembly in Yeouido, western Seoul, on Oct. 22.NEWS1
Financial Services Commission (FSC) Chairman Lee Eog-weon said Thursday that a potential U.S. stock market listing of Solidigm, a subsidiary of SK hynix, would be subject to Korea's regulations on split listings.
The move would also require SK hynix and SK Square, both of which sit above Solidigm in the group's ownership structure, to fulfill shareholder protection obligations, according to financial authorities.
"It falls under the guidelines on split listings," Lee said during a comprehensive parliamentary audit of the National Assembly's National Policy Committee in response to a question from Rep. Park Sung-hoon of the People Power Party on whether he agreed with the Financial Supervisory Service (FSS) governor's assessment that Solidigm's potential U.S. listing would constitute a split listing.
"SK Square and SK hynix, as parent companies, must fulfill five obligations based on their fiduciary duties to shareholders," Lee said.
Under regulations established by the FSC and the Korea Exchange, split listings are generally restricted.
For an exception to be granted, parent companies must fulfill the following obligations: assess the impact on shareholders, establish shareholder protection measures, communicate with shareholders, obtain a board resolution approving or opposing the listing and disclose relevant information.
Solidigm was established after SK hynix acquired Intel's NAND flash memory and solid-state drive operations in 2021.
The company's multilayered ownership structure runs from SK Inc. through SK Square, SK hynix and AI solution firm AI Company to Solidigm.
Logos of SK hynix and SolidigmSK HYNIX
Speculation that Solidigm could pursue a listing on a U.S. stock exchange has recently raised concerns that the move could dilute the value of existing shareholders' holdings in its parent companies.
FSS Gov. Lee Chan-jin also said during a parliamentary audit of the National Assembly’s National Policy Committee on Monday that both the FSC and FSS considered Solidigm subject to Korea's split listing regulations.
During Thursday's parliamentary audit, Rep. Lee Kang-ill of the Democratic Party asked whether domestic split-listing regulations also apply to companies seeking listings on overseas stock exchanges. The FSC chairman confirmed that they do.
"The guidelines on split listings apply to both domestic and overseas listings," Lee Eog-weon said.
However, the FSC chairman was more cautious when asked whether Solidigm would be required to file a securities registration statement with Korean financial authorities.
"There has been no official announcement that the company is pursuing a listing, nor have any concrete details been disclosed," Lee Eog-weon said, declining to provide a definitive answer.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
