"This Is Not Right, Chairman"...Flood of Criticism over SK hynix's Pursuit of 'Five-Layer Duplicate Listing'
Strong Criticism of Plans to Cross-List Solidigm in the U.S.
Cross-Listing Called "Exporting the Korea Discount"
"SK hynix Must Break Free from a Rubber-Stamp Board that Harms Shareholder Rights"
The Korea Corporate Governance Forum has criticized SK hynix's move to list its U.S. subsidiary, Solidigm, describing it as an unprecedented attempt at a five-stage multi-layered listing in the global market.
On the 13th, the Governance Forum directly mentioned Chey Tae-won, Chairman of SK Group, and Go Seung-beom, Chairman of the Board of SK hynix, in a statement, pointing out, "Circumventing the three-stage limit under Korea's Fair Trade Act by expanding the governance pyramid via overseas entities amounts to exporting the 'Korea Discount.'"
Five-Stage Multi-Layered Listing, Exporting the Korea Discount
The Governance Forum analyzed that this multi-layered listing structure consists of five steps: Chairman Chey Tae-won → SK Inc. → SK Square → SK hynix → SK hynix NAND Product Solutions → Solidigm. The forum stated, "There are no examples among major global semiconductor companies such as Nvidia or Taiwan's TSMC where a subsidiary is being pushed for multiple listings," and added, "Instead of expanding pyramids abroad through overseas entities, SK Inc.–SK Square–SK hynix should first address the existing domestic three-stage multi-layered listing issue."
The Governance Forum criticized such complex governance structures and attempts at multi-layered listing as key reasons why SK hynix's stock is undervalued. SK hynix’s 12-month forward price-to-earnings ratio (PER) sits at about 3 times. JP Morgan estimates SK hynix will generate a total of 811 trillion won in free cash flow (FCF) over the next three years (213 trillion won in 2026, 265 trillion won in 2027, and 333 trillion won in 2028).
The forum also criticized the 'capital call' structure in which SK Telecom (480 million dollars), SK Inc. (250 million dollars), and SK Innovation (380 million dollars) have decided to invest in Solidigm's parent company. The concern is that other SK affiliates with high stakes held by Chairman Chey, such as SK Inc., will share in the achievements of Solidigm, which was developed by SK hynix, just before it is listed. This could result in a transfer of value from SK hynix shareholders to SK affiliates.
"SK hynix Board Must Change"
The Governance Forum also called for accountability from Chairman Go Seung-beom and six SK hynix outside directors—Jeong Deokgyun, Kim Jeongwon, Yang Donghoon, Son Hyuncheol, and Choi Kang-guk. Chairman Chey is a non-registered executive at SK hynix and not a board member.
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The forum stated, "According to the Commercial Act, directors are required to convene and submit board agendas to review the push for Solidigm’s listing and whether it infringes on shareholder rights. The independence of directors is not a privilege granted or allowed by others, but a promise to shareholders won and safeguarded by one’s own choice and responsibility as a professional."
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