Attention is focused on why SK hynix is moving to scale up its U.S. NAND flash subsidiary Solidigm. With reports that it is reviewing various fundraising options, including a pre-IPO of 5 trillion to 10 trillion won aimed at a Nasdaq listing, Solidigm, which once suffered from complete capital impairment, is seen as seeking independent financing on the back of a recent return to profit and its No. 2 position in the enterprise SSD (eSSD) market.
According to the industry on the 6th, Solidigm has shortlisted Morgan Stanley and Goldman Sachs as potential lead underwriters and is said to be sounding out investment interest from global alternative asset managers and overseas sovereign wealth funds. SK hynix said in a disclosure the previous day that nothing has been finalized, but as it was confirmed that Solidigm is hiring an executive to oversee U.S. Securities and Exchange Commission (SEC) filings and external financial reporting, expectations have grown that listing preparations are indeed underway.
Some suggest Solidigm's target valuation reaches about 50 trillion won. This is interpreted as reflecting a view that Solidigm's 4-bit (QLC) NAND technology and ultra-high-capacity eSSD lineup have been undervalued, having been obscured within SK hynix's consolidated results. In fact, Solidigm has solidified a technological edge in the large-capacity storage market, including by launching the world's first 122-terabyte (TB) QLC eSSD, the world's largest capacity.
Experts see the fundraising push as driven by a judgment that now, amid a continued boom in artificial intelligence (AI) infrastructure investment, is the right time to maximize valuation. A domestic semiconductor industry official said, "The idea that this cycle is the last chance means raising the company's valuation as high as possible before the AI infrastructure fever cools to bring in ample capital and scale up the company," adding, "In particular, the scale of corporations providing enterprise storage solutions has become markedly different from the past."
Still, Solidigm's weak financial structure is part of the backdrop. From 2021 to 2023, Solidigm posted nearly 8 trillion won in cumulative net losses over three years, and in the first half of 2024, total equity fell to minus 906 billion won, putting it in a state of complete capital impairment. To fill the gap, operating funds lent by SK hynix had swollen to a cumulative 11.3196 trillion won as of early 2025. Although it swung to an annual profit in 2024 and escaped complete capital impairment, its debt ratio in the same year was not 448.46 billion won but 4,484.6%, about 14 times the generally appropriate level (200% or less). Despite the return to profit, financial stability itself remains fragile.
Aging facilities also remain a challenge. Solidigm's only overseas production base, the Dalian fab in China, effectively had the introduction of advanced equipment such as extreme ultraviolet (EUV) blocked by U.S. semiconductor export controls against China, derailing planned capacity expansions and upgrades. As a result, despite being a key site responsible for about 30% of SK hynix's NAND output, there have been repeated delays in equipment conversions and stagnation in Production yield improvements, observers say. With the NAND market rebounding, SK hynix is again weighing investment in the Dalian fab, but as U.S.-China tensions persist, the prevailing view is that it will pursue limited conversion investments first rather than large-scale expansion.
An investment banking (IB) industry official said, "There are hopes of achieving two goals—normalizing Solidigm's capital structure and easing SK hynix's borrowing burden—but unless fundamental issues such as geopolitical risks and aging facilities are resolved, it will be difficult for investors to fully accept the targeted valuation."