SK hynix secured $7 billion (about 10 trillion won) in cornerstone investments on the first day of bookbuilding for issuing American depositary receipts (ADR). Cornerstone investment is a system in which key institutional investors agree to purchase part of the offering in advance before listing, and it is considered an indicator of investor confidence.
According to Reuters and others on the 7th, three cornerstone investors—Baillie Gifford, Coatue Management, and Situational Awareness Partners—expressed intent to buy $7 billion worth of SK hynix ADRs. That amounts to 25% of the ADR offering size (about 43 trillion won).
However, because this is an indication of interest without legal binding force, the allocation could be adjusted depending on the results of demand forecasting. SK hynix is holding a roadshow (investor presentation) for global institutional investors from the 6th to the 9th. It will set the offer price on the 10th and begin transaction on Nasdaq.
This cornerstone investment amount ranks among the highest on record. PayPay, a Japanese Fintech corporations listed on Nasdaq this year, received expressions of interest to buy $220 million from three cornerstone investors. ARM, a British semiconductor design corporations listed on Nasdaq in 2023, also saw multiple global corporations participate as cornerstone investors, but the amounts they offered were around $735 million.
The market is also focusing on investor Situational Awareness. The firm is an AI-focused hedge fund founded by former OpenAI researcher Leopold Aschenbrenner. The Financial Times (FT) said the fund "has achieved early investment performance in AI-related stocks and is gaining significant popularity among retail investors." The fact that an asset manager specializing in AI investment joined as a cornerstone investor for SK hynix is being interpreted as showing that global investors highly value the company's growth potential and competitiveness.
SK hynix plans to use the funds raised to invest in facilities, including construction of the Phase 1 fab at the Yongin semiconductor cluster; construction, equipment, and ancillary costs for the Cheongju P&T7 advanced packaging fab; and extreme ultraviolet (EUV) scanners.