SK Hynix has been posting record-breaking profits driven by the AI semiconductor supercycle, including high-bandwidth memory (HBM) and enterprise SSDs (eSSD). Paradoxically, however, market attention is focused less on these strong results and more on the future trajectory of its key subsidiary, Solidigm. This is because discussions have intensified regarding the possibility of listing Solidigm separately on the U.S. NASDAQ, sparking controversy over a "quadruple overlapping listing."
Currently, SK Group maintains a vertically structured listing hierarchy with Choi Tae-won (Chairman) at the apex, followed by SK Inc., SK Square, and SK Hynix. In this structure, SK Hynix has reorganized its AI operations in the U.S. by renaming its existing Solidigm entity to "AI Company" and transferring its NAND and eSSD businesses to a newly established subsidiary also named Solidigm. If the new Solidigm were to list on NASDAQ, it would create a complex governance structure featuring four listed companies within a five-tier pyramid: SK Inc. → SK Square → SK Hynix → AI Company → Solidigm. Investment banking firms are already discussing the pre-IPO scale and specific timelines for the NASDAQ listing, while U.S. asset management companies have submitted registration statements for ETFs linked to Solidigm, signaling that the listing is becoming increasingly tangible. Nevertheless, SK Hynix maintains its stance that it is "still under review and not yet finalized."
If SK Hynix had sought only to list Solidigm, it could have simply listed the existing entity as is. So why create such a complex structure by renaming the parent company to AI Company and placing a new Solidigm beneath it? The market views this as a capital reallocation strategy aimed at resolving limitations within SK Group's governance structure. For SK Hynix's substantial profits to flow directly to its top-tier holding company, SK Inc., they must pass through the intermediate holding company, SK Square. This process creates structural bottlenecks, including tax burdens and reduced dividend efficiency. Analysts suggest that SK Hynix is attempting to bypass these constraints by utilizing its U.S. subsidiary as an intermediary link.
SK Hynix plans to drive new growth businesses centered on AI Company, including AI software development, system optimization, and investments in related companies, while leveraging Solidigm's existing eSSD business as core infrastructure connected to AI data centers. In other words, AI Company is not merely an organization for managing Solidigm but a platform designed to expand its business scope across the entire AI ecosystem.
However, the issue lies in SK Hynix establishing a structure where other group affiliates—SK Inc., SK Innovation, and SK Telecom—inject capital into AI Company, which SK Hynix previously held 100% of. If Solidigm's shares had remained 100% owned by SK Hynix as before, any profits generated from Solidigm's future growth and the resulting increase in corporate valuation would directly contribute to SK Hynix's asset value and shareholder value. However, by creating a separate AI Company and placing a new Solidigm beneath it, while allowing other group affiliates to become shareholders of AI Company, the structure changes so that value created by AI Company and its subsidiaries is no longer exclusively retained by SK Hynix. Instead, a portion of that value will flow to SK Group affiliates and other participating shareholders.
This is precisely why some segments of the market view AI Company as an "alternative route for cash generation within SK Group." If Solidigm generates massive cash flows and corporate valuation alongside growth in the AI data center market, that value may not accumulate solely within SK Hynix but could instead be shared across multiple group affiliates through AI Company. That said, it cannot be definitively concluded that this structure is designed to transfer profits generated by SK Hynix's subsidiary to other group companies.
A more fundamental question remains: Why did SK Hynix place a business it has already cultivated with capital and management expertise under a separate AI Company and invite participation from other group affiliates? Furthermore, who ultimately receives the newly created corporate valuation and cash flows generated through this structure, and in what proportions? For existing SK Hynix shareholders, their economic rights could be altered.
Moreover, Solidigm has been evaluated as a financially burdensome business that recorded significant losses for an extended period after SK Hynix acquired Intel's NAND business in 2020. SK Hynix has shouldered the investments and business risks up to this point. If it now adopts a structure accepting external investors precisely when the business gains value due to growth in the AI semiconductor market, existing shareholders may express frustration: "We bore all the risks during difficult times alone; now that things are going well, you want us to share the profits with group affiliates and new investors?" Therefore, any newly created value through listing must sufficiently offset the dilution of equity and changes in value distribution borne by existing SK Hynix shareholders.
From SK's perspective, there is justification for Solidigm's NASDAQ listing. In a rapidly growing AI data center market, it would secure large-scale investment capital and receive proper recognition of corporate valuation within the U.S. capital markets, which assign high valuations to eSSD and AI data infrastructure companies. While this management strategy itself cannot be dismissed outright, the issue lies in the fact that the benefits of revaluation are not flowing exclusively to existing SK Hynix shareholders but are instead being distributed among group affiliates participating in AI Company and new external investors.
In fact, this is not the first time SK has faced controversy over splitting its core businesses for listing purposes. Around 2021, SK leveraged the "financial story" narrative to sequentially spin off and list key growth businesses such as SK Biopharm, SK I&T, and SK Bioscience, attracting external capital. However, this ultimately led to excessive financial burdens, triggering group-level restructuring. The criticism that Solidigm's listing represents "Financial Story Season 2" stems from concerns over the repetition of the same pattern.
Furthermore, numerous criticisms argue that justifications such as fundraising or entering the U.S. market do not align with reality. Currently, SK Hynix has secured massive operating cash flows and liquidity based on the AI memory boom. Even if trillions of won in investment capital were needed, it could be fully covered by its own cash flows; thus, there is no compelling reason to sell shares of a high-growth subsidiary externally. Additionally, considering that SK Hynix has already listed American Depositary Receipts (ADRs) in the U.S. capital markets and secured access to global investors, merely citing "access to global capital markets" is insufficient to justify listing its subsidiary.
The core of this controversy lies not in whether listing occurs but in how value is distributed. If SK Hynix places its directly held businesses under a separate platform called AI Company and invites participation from other group affiliates to boost overall corporate valuation, the corresponding economic benefits must also flow back to existing SK Hynix shareholders. Conversely, if it transfers growth assets cultivated by existing shareholders into a separate legal entity and shares the profits with group affiliates and external investors, vague explanations like "business efficiency" are inadequate. Ultimately, from the perspective of ordinary SK Hynix shareholders, this can only be interpreted as "erosion of shareholder value" and "transfer of profits to other group companies," where core assets and future earnings are handed over to other affiliates and external investors.
If SK proceeds with Solidigm's NASDAQ listing, it must present alternatives that demonstrate at least minimal legitimacy. First, transparent explanations regarding the necessity of the listing, the rationale behind the complex structure, the background for group affiliate participation, and measures to compensate shareholders in case of stock price declines must be provided. Furthermore, practical shareholder protection measures should be implemented alongside these explanations, such as directing all proceeds from the sale of existing shares during the listing process entirely toward SK Hynix share buybacks, cancellations, and special dividends to serve as a source for shareholder returns, or granting existing SK Hynix shareholders preemptive rights to subscribe to new shares. Additionally, more fundamentally, SK must pursue governance reforms that shorten the vertical governance chain extending from SK Inc. → SK Square → SK Hynix.
If NASDAQ listing is forced through without such clear post-listing measures and governance reforms, it will be difficult to avoid criticism that this is merely an "overseas export of K-discount" hidden behind the pretext of global expansion.
in OPINION
