SK hynix on the first day of bookbuilding for issuing American depositary receipts (ADR) secured $7 billion (about 10 trillion won) in cornerstone investment. A cornerstone investment is a system in which key institutional investors agree to pre-purchase part of the offering before listing, and it is regarded as an indicator showing investors' confidence.
According to Reuters and others on the 7th, three cornerstone investors—Baillie Gifford, Coatue Management, and Situational Awareness Partners—expressed intent to buy SK hynix ADRs totaling $7 billion. That equals 25% of the ADR offering size (about 43 trillion won).
However, because this is an indication of interest without legal force, the size could be adjusted depending on the results of the upcoming bookbuilding. 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 start transaction on Nasdaq.
This cornerstone investment ranks among the largest on record. PayPay, a Japanese Fintech corporations listed on Nasdaq this year, received purchase intentions of $220 million from three cornerstone investors. ARM, a British semiconductor design corporations listed on Nasdaq in 2023, also drew many global corporations as cornerstone investors, but the amount they offered was about $735 million.
The market is also focusing on investor Situational Awareness. The company is an AI-focused hedge fund founded by former OpenAI researcher Leopold Aschenbrenner. The Financial Times (FT) said the fund "is gaining strong popularity among retail investors by delivering early performance in AI-related stocks." 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 for facility investments, 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.