SK hynix's affiliate SKC raises over 1 trillion won through share offering to boost mass production of glass substrates

SK hynix's affiliate SKC raises over 1 trillion won through share offering to boost mass production of glass substrates

As SK Hynix, a major storage chip producer, draws market attention, SKC—another SK Group member—launches large-scale equity financing to ramp up its presence in next-generation semiconductor packaging materials.

According to reports, SKC recently announced plans to issue 11.73 million new shares, raising 1.1671 trillion Korean won (about RMB 5.3 billion). Of the total raised, approximately 589.6 billion won will go to its subsidiary Absolics to support the mass production of glass substrates over the next three years.

The final offering price is set at 99,500 won per share, significantly higher than the initial estimate of 70,600 won. The sharp upward adjustment reflects a market revaluation of the company’s worth: on one hand, this stems from high expectations for the growth prospects of the glass substrate business; on the other, it is due to the company ending ten consecutive quarters of losses and returning to profitability, with a substantial fundamental recovery boosting market confidence.

An SKC executive stated, "Despite challenging market conditions, shareholders and investors have shown strong confidence in the recovery of our core competitiveness and in the future value of our next-generation glass substrate business. With this fundraising, we will steadily advance the commercialization of glass substrates and greatly improve our financial structure."

Accelerated Debt Repayment Strengthens Financial Structure

The enlargement of this fundraising is mainly due to SKC's recent strong share price growth, with the company’s stock rising 50% over the past month.

According to the share allocation pricing mechanism, the issue price is set at 80% of the reference share price during a specific calculation period. The initial price was based on the April 2 share price, while the final price was determined by the May 11 share price, driving the total funds raised higher. Furthermore, in Q1 this year, SKC achieved consolidated revenue of 1.7216 trillion won and operating profit of 7.62 billion won, ending ten consecutive quarters of operating losses. Improved profitability further boosted market confidence.

With the total fundraising amount increased, SKC correspondingly adjusted its use of funds, significantly enhancing the debt repayment portion. The latest plan shows funds for debt repayment rising from the previously planned 238.5 billion won to 577.5 billion won, a marked increase. Initially, SKC planned to invest about 590 billion won in the glass substrate business and about 410 billion won in debt repayment.

Notably, despite overall fundraising expansion, SKC’s investment in its subsidiary Absolics remains unchanged at 589.6 billion won. SKC explained that this amount was determined based on the maximum projected funding needed for the next three years, which had already been secured. Absolics, SKC’s U.S. subsidiary for the glass substrate business, recently supplied non-embedded glass substrate prototypes for next-generation network semiconductors to a U.S. communications chip company, marking a new phase for the business.

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