Global Market: South Korea regulator says Solidigm US listing may breach dual-listing rules

A potential US listing of Solidigm puts shareholder protection and South Korea’s dual-listing rules under scrutiny.

Financial Supervisory Service Governor Lee Chan-jin said on Monday that both the Financial Services Commission (FSC) and the watchdog had judged that the potential listing could breach dual-listing rules.

Lee made the remarks during a parliamentary hearing in response to questions about how regulators would protect minority shareholders of SK Hynix if Solidigm went public in the United States.

The FSC has been awaiting an official interpretation of whether the proposed offering would require a domestic securities registration filing, Lee said.

Reuters reported in September that Solidigm was considering an initial public offering as early as next year that could value the US subsidiary at up to $150 billion.

South Korean regulators introduced tighter dual-listing rules in July to better protect minority shareholders. Under the revised framework, company boards must obtain minority shareholders' consent before listing a subsidiary in South Korea or overseas.

The proposed Solidigm listing has drawn attention to potential implications for SK Hynix shareholders, as investors assess how a separate listing could affect the parent company's valuation and ownership structure.

Earlier this month, SK Hynix said it would evaluate measures to protect its shareholders in response to market concerns surrounding a potential Solidigm IPO.