Solidigm's Potential IPO at $150 Billion Valuation Faces Regulatory Objection in Korea
Key Facts
Solidigm's potential initial public offering, which could value the company at up to $150 billion, faces objections from Korean regulators over its compliance with dual-listing rules. Lee Chan-jin, governor of the Financial Supervisory Service, said in remarks carried by Chosun Biz on October 19 that the agency and the Financial Services Commission considered the potential listing inconsistent with those rules. He added: "The Financial Services Commission also believes it conflicts with dual-listing rules, and so do we." Reuters reported in an article published by Investing in September 2026 that Solidigm was considering an initial public offering in 2027. The report said the company could seek to raise up to $15 billion in the transaction, at a potential valuation of up to $150 billion. These potential plans subject Solidigm's financing to regulatory requirements concerning the impact of subsidiary listings on parent-company shareholders.
A Financial Services Commission document sets out obligations for the parent company's board, starting with an assessment of the subsidiary listing's impact on shareholders. It requires the board to prepare measures to protect them, alongside communicating with them or verifying their approval of the transaction. The board must also pass a resolution approving or rejecting the listing, then notify the subsidiary of its decision. The obligations include disclosing the procedures and explaining why a shareholder vote was not held if no such vote took place. According to the document, an independent special committee reviews and approves the fulfillment of these obligations. The same requirements apply when the subsidiary's planned listing is on a foreign exchange, extending protection for parent-company shareholders to listings outside the domestic market.
Reforms to the dual-listing rules took effect on August 3, 2026, according to the Financial Services Commission. The final version retained mandatory shareholder approval for listings of subsidiaries created through a physical split-off of a business. In other cases, obtaining shareholder approval was framed as a recommendation. The rules therefore distinguish, in terms of mandatory approval, between subsidiaries created through a business split-off and other subsidiaries. The commission's guidelines list distributions in kind among examples of mechanisms that can be prepared to protect shareholders. The examples also include the cancellation of treasury shares, as part of the measures the parent company must prepare when considering a subsidiary listing.
Solidigm sits within an ownership chain running from SK Inc. to SK Square, then SK Hynix, through AI Company and on to Solidigm, according to SBS. The company's business centers on high-capacity enterprise storage drives used in artificial intelligence data centers, according to SK Hynix's clarification. This business places Solidigm in the field of supplying data centers with storage media for enterprise use. Against the backdrop of the company's plans, Reuters published a report on its consideration of building a memory chip plant in the United States. In the trading session on the date of that report, September 18, 2026, SK Hynix shares closed up 6.4%. In the same session, the benchmark Kospi index rose 2.7%, according to Reuters via Investing. The stock outperformed the index at the time as news circulated that the U.S. plant was under consideration.
On financing, SK Hynix said it was considering multiple capital deployment options for Solidigm, including the use of internal funds. It pledged that long-term corporate and shareholder value would be the primary criterion for any option it considered. In its clarification, it stressed that "matters have not been decided," leaving an IPO among the possibilities under consideration. On the regulatory front, authorities were awaiting a formal interpretation of whether the potential offering would be subject to domestic securities registration requirements, according to Reuters. That interpretation concerns the domestic registration requirements for the transaction the company is considering. As for the next disclosure, SK Hynix linked it in its regulatory filing to confirmation of specific details. It pledged to provide an additional disclosure when those details were confirmed or within 3 months of the filing date.