SK Hynix is reportedly considering a fee of approximately 0.5% of the funds raised for its American Depositary Receipt (ADR) listing.
According to Bloomberg on July 4, SK Hynix is in discussions with global investment banks, including Bank of America, Citigroup, Goldman Sachs, and JP Morgan, regarding the ADR listing fees and performance bonuses.
Based on SK Hynix's recent market capitalization, the ADR offering could raise around $26.5 billion (approximately 40.5 trillion won). Applying the 0.5% fee rate, the total fees for the underwriters are estimated to be about $130 million (around 199 billion won). However, the specific terms may change.
The 0.5% fee rate is lower than the 0.67% fee charged for SpaceX's recent record-breaking initial public offering (IPO). Nonetheless, due to the substantial size of this 'mega deal,' Bloomberg anticipates it will result in one of the highest fees for Asian corporate transactions this year.
Bloomberg also noted that this ADR listing could become one of the largest stock offerings in history, following SpaceX (approximately $86 billion) and Saudi Arabia's state-owned oil company Aramco (approximately $29.4 billion).
Additionally, as SK Hynix has been listed on the domestic stock market for a long time and is one of the most notable global tech stocks this year, it is expected that the workload for underwriters will be relatively manageable due to high recognition among foreign investors.
Previously, SK Hynix announced plans to issue ADRs based on common shares representing up to 2.5% of its total outstanding shares. The actual offering size and issuance volume will be finalized following a demand forecast (book building) targeting foreign institutional investors.
ADRs are securities issued by foreign companies that allow their shares to be traded on U.S. stock exchanges.
* This article has been translated by AI.
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