SK Hynix’s Solidigm has selected Goldman Sachs and Morgan Stanley for a US initial public offering planned for 2027 that could raise about $10 billion, Bloomberg reported on 7 October, citing people familiar with the matter.
Key points
- Goldman Sachs and Morgan Stanley are the reported lead banks for Solidigm’s planned US listing.
- The offering could raise about $10 billion. An earlier report put Solidigm’s fundraising target at $15 billion.
- Solidigm is working with the banks on a separate pre-IPO funding round.
Goldman Sachs and Morgan Stanley take lead
The selection follows meetings Solidigm held with investment banks during the week of 25 September to choose underwriters, Chosun reported. The move takes the proposed listing from a search for banks to work on the offering to a reported choice of lead institutions.
Solidigm is also working with Goldman Sachs and Morgan Stanley to finalise a funding round ahead of the IPO, the people familiar with the matter told Bloomberg. That round is separate from the planned public offering.
Both reported steps concern fundraising by SK Hynix’s flash memory unit. The pre-IPO round is still being finalised, according to Bloomberg’s sources, while the public listing is planned for next year. SK Group has not officially commented on Solidigm’s listing plans, Chosun reported.
Two fundraising figures for Solidigm’s IPO
The proposed offering could raise about $10 billion, according to the people cited by Bloomberg. Chosun reported that an earlier Reuters account put Solidigm’s fundraising aim at $15 billion.
The earlier account estimated that Solidigm’s corporate value could reach up to $150 billion. That figure is an estimate of the company’s value, rather than the amount it aimed to raise by selling shares in an IPO.
The report compared that prospective value with $54 billion for Arm, which went public in 2023, and $56 billion for Cerebras.
Solidigm was also the subject of an earlier AI Affairs report on a possible US listing at a valuation of up to $150 billion. The latest report concerns the choice of banks and a separate funding round, as well as the potential size of the IPO.
Solidigm’s Intel NAND business and enterprise SSDs
Solidigm was established in 2020 from a NAND memory business acquired from Intel. The company chiefly makes enterprise solid-state drives for servers, cloud infrastructure and data centres.
SK Hynix owns the flash memory unit. The ownership chain described by Chosun runs from SK Inc. through SK Square, SK Hynix and an SK Hynix subsidiary called AI Company to Solidigm. SK Inc., SK Square and SK Hynix are already listed, the publication reported.
Bringing outside investors into Solidigm would dilute AI Company’s stake, a concern for SK Hynix shareholders. A smaller stake would also reduce the share of Solidigm’s future profits attributable to SK Hynix, it reported.
SK Group arguments on internal funding
SK Group expected the semiconductor supply shortage to persist for years and saw a need for rapid responses, including factory expansions. Some within the group argued that relying solely on internal funds would constrain its ability to finance semiconductor operations.
SK Hynix has separately said that no decision had been made on a Solidigm listing, as AI Affairs reported.
