SK Hynix Pauses Plans for Solidigm IPO

SK Hynix has paused plans to take Solidigm public.

Reports first emerged in August that SK Hynix intended to list the memory-chip maker after completing its own $26.5 billion US IPO. Those reports suggested an initial Solidigm valuation of $35.3 billion and prompted concern in South Korea that outside investors could reduce SK Hynix's indirect ownership stake in Solidigm and lower its overall corporate value.

In a recent statement, SK Hynix said it would pause its review of potential pre-IPO and IPO options. The company said the decision "does not reflect any change in Solidigm's growth prospects or investment needs."

"Rather, in light of recent capital market conditions and share price trends, Solidigm determined that it was necessary to reassess whether an IPO would be the most beneficial option for SK Hynix and its existing shareholders at this time," the company said.

The proposed IPO was intended to address capacity constraints at Solidigm's existing production facilities as demand continues to rise alongside the ongoing AI infrastructure buildout. SK Hynix evaluated an IPO alongside a direct investment in its US subsidiary, in addition to the $10 billion it had already committed to Solidigm through its AI Company (AI Co.) venture, announced in March.

SK Hynix said an appropriate IPO valuation could recognize Solidigm's growth potential more adequately than the company's current contribution to SK Hynix's corporate value.

Citing financial-market volatility and a broader correction in semiconductor stocks, SK Hynix said it would continue evaluating the timing, scale, and financing methods for investment. It will also assess alternative ways to support Solidigm's expansion.

The decision ends months of discussion about the IPO and marks another stage in Solidigm's history. The company began as Intel's non-volatile memory (NAND) and solid-state drive (SSD) business. SK Hynix acquired it for $9 billion in 2020 and merged it with its own NAND operations.

Solidigm became more closely integrated into SK Hynix in May, when Richard Chin was appointed co-CEO. Chin, formerly global sales senior vice president for SK Hynix's America arm, serves alongside Xin Guo, who had been promoted to the co-CEO position several months earlier.

SK Hynix's AI Co. plans also appear to have slowed. Recent investments have come from other companies within the SK Group. SK Innovation committed $380 million to the project in March, while SK Telecom pledged approximately $480 million in June. These are the only two publicly announced investments since the venture launched.

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