From BigGo Finance · BigGo Finance · · 1m 50s
South Korea's Stock Market Blocks Corporate Funding
South Korea's duplicate-listing rules block SK Hynix's $45bn U.S. plant funding.
In brief
South Korea's duplicate-listing rules block SK Hynix's $45bn U.S. plant funding. South Korea's duplicate-listing rules prevent SK Hynix from raising capital for a $45bn-$100bn U.S. semiconductor plant. Originally reported by BigGo Finance.
Duplicate-Listing Ban Blocks Funding
South Korea's duplicate-listing rules prevent SK Hynix from raising capital for a $45 billion to $100 billion U.S. semiconductor plant.
SK Hynix Halts Nasdaq Listing Review
SK Hynix suspended its review of Solidigm's Nasdaq listing after Financial Supervisory Service criticized it as violating duplicate-listing rules.
Solidigm's Funding Needs
Solidigm requires $45 billion to $100 billion to build NAND flash plants in New York State with U.S. government investment under discussion.
LG Chem Benefits from Split
LG Chem raised 5.9 trillion won ($4.4 billion) by selling LG Energy Solution shares through price return swaps.
Duplicate-Listing Rules Origin
The rules stem from concerns about shareholder dilution after LG Chem split its battery business in 2020.
Rules Apply to Different Cases
The rules blocked LS from listing Essex Solutions, a great-grandchild subsidiary, after President Lee Jae-myung flagged it.
LG Chem's Fundraising Strategy
LG Chem sold 6,535,939 LG Energy Solution shares for 2.5 trillion won ($1.9 billion) to reduce its stake to 76.59%.
Shareholder Impact
When listings are blocked, companies must borrow from private equity funds, raising costs of capital for shareholders.
Professor's Viewpoint
Shin Hyun-han says duplicate listings should be assessed by purpose of funds raised, not formal requirements.
Industry Concerns
Korea Federation of Middle Market Enterprises says subsidiary listings boost competitiveness and long-term corporate value.
Retail Investor Influence
South Korea's retail investors, sensitive to short-term price swings, drive tighter duplicate-listing rules.
Funding Consequence
SK Hynix must cover U.S. plant costs through loans, burdening shareholders and potentially slowing economic growth.
The key point
South Korea's duplicate-listing rules prevent SK Hynix from raising capital for a $45bn-$100bn U.S. semiconductor plant.
