Lee Chan-jin: “SK hynix’s Solidigm listing constitutes a duplicate listing” [KOSPI in flux]

Lee Chan-jin, governor of the Financial Supervisory Service (FSS) (pictured), said that SK hynix’s plan to list its U.S. grandchild subsidiary Solidigm constitutes a duplicate listing. He acknowledged that the review had been expedited in part to meet the listing schedule for single-stock leveraged exchange-traded funds (ETFs).
At the National Assembly’s National Policy Committee audit of the FSS on the 19th, Lee said of the plan to list Solidigm, “Both the Financial Services Commission (FSC) and the FSS have concluded that it violates the rules against duplicate listings.” Solidigm is a U.S. company established by SK hynix after it acquired Intel’s NAND flash and solid-state drive (SSD) business. Concerns have been raised that listing the grandchild company after the parent company could undermine the value of existing shareholders’ holdings.
When Rep. Park Seong-hun of the People Power Party pointed out that “SK hynix explained to the U.S. Securities and Exchange Commission (SEC) the negative impact a subsidiary listing could have on its parent company’s stock price, but has given no explanation to domestic shareholders,” Lee said, “We are looking into the impact on existing shareholders.” He added that matters related to the securities registration statement required further discussion and that the FSC had not yet been formally asked for an authoritative interpretation.
SK hynix’s current position is that nothing has been finalized regarding a Solidigm listing.
Regarding the review of single-stock leveraged ETFs, Lee said, “The FSC announced the listing schedule as a matter of policy,” adding, “There was some speeding up of the review to meet that schedule.” Asked whether this was the first time the FSS had reviewed an ETF before the exchange’s preliminary review was complete, he replied, “Having checked, it seems so.”
Earlier, Rep. Park Dae-chul of the People Power Party pressed the FSC over why it had announced a listing date before an application was filed and why the FSS had begun its review before the exchange’s preliminary review was complete. A regular ETF takes an average of 62 days to be listed, compared with just 29 days for this product. He criticized the process, saying, “They reviewed a risky product in less time.”
In response to a question from Rep. Song Eon-seok of the People Power Party about whether he had flagged in advance the possibility that single-stock leveraged ETFs could increase the volatility of their underlying stocks, Lee said, “I did not explicitly flag that,” and added, “I apologize.”
[email protected] Lee Jeong-hwa, Im Sang-hyeok Reporter