Abstract:
Solidigm, the U.S. storage business unit of South Korean chipmaker SK Hynix, is considering an initial public offering as early as 2027, at which time the company's valuation could reach as high as $150 billion. If the plan finally comes to fruition, it will become one of the largest IPOs in the history of the U.S. semiconductor industry.
According to people familiar with the matter, Solidigm has held bidding promotion meetings with a number of investment banks this week, inviting banks to compete for underwriting and advisory roles in the IPO. This is regarded as a more concrete step in Solidigm's progress in its listing plan.
Informed sources said that Solidigm’s IPO may raise approximately US$15 billion. However, the transaction is still in the early planning stage, and the specific issuance size, valuation and listing time may change depending on the capital market environment. The people spoke on condition of anonymity because the discussions involved business plans that have not yet been made public.
If it is eventually listed at a valuation of US$150 billion, Solidigm’s IPO size will be significantly larger than the valuations of some large semiconductor companies when they went public in recent years. For comparison, Arm will be valued at about $54 billion when it goes public in 2023, while Cerebras Systems will have a fully diluted valuation of about $56 billion in its 2026 IPO.
Solidigm, headquartered in Rancho Cordova, California, is the U.S. subsidiary of SK Hynix responsible for the NAND flash memory and solid-state drive business. The company mainly provides SSD products for the enterprise market, which are widely used in servers, cloud computing infrastructure and data centers.
SK Hynix announced in 2020 that it would acquire Intel's NAND flash memory and SSD business for approximately US$9 billion, and then integrated the related businesses with Solidigm, and officially established the independent brand Solidigm in 2021. SK Hynix said at the time that the acquisition would strengthen its NAND flash memory and enterprise SSD business and expand its competitiveness in the global storage market.
In recent years, Solidigm has gradually focused on large-capacity enterprise-class SSDs, paying particular attention to the storage needs brought about by artificial intelligence data centers. As the scale of AI models continues to expand and the amount of data that data centers need to process and save rapidly increases, the importance of high-capacity, high-performance storage devices also increases.
Compared with GPU and HBM, NAND flash memory is mainly responsible for data storage functions, while SSD is an important device connecting computing systems and large-scale data storage. Although AI data centers receive the most attention for GPU computing capabilities, as the size of model training data, inference data, and checkpoint files continues to grow, the demand for enterprise-level SSDs and large-capacity storage systems is also increasing rapidly.
Solidigm is capitalizing on this trend to expand its enterprise SSD business and sees AI data centers as an important market for future growth. The company has previously launched enterprise-level SSD products for high-capacity data center scenarios, hoping to take advantage of the boom in AI infrastructure construction to improve its competitiveness in the NAND market.
Just earlier this month, Reuters also reported that Solidigm was considering building a NAND flash memory chip factory in the United States, and upstate New York is currently considered one of the main candidate locations. The project will be used to further expand Solidigm’s manufacturing capabilities in the United States.
If the U.S. NAND factory and this IPO are eventually implemented, Solidigm will form a more complete business system in the United States from memory chip manufacturing, enterprise-level SSD to capital market financing in the future.
In fact, SK Hynix has already begun studying how to further improve Solidigm’s competitiveness. In August, the company said it was evaluating various options but stressed at the time that no final decision had been made. Previously, Korean media reported that Solidigm may plan for pre-IPO financing of about 5 trillion to 10 trillion won, equivalent to about 3.6 billion to 7.2 billion US dollars.
The latest news now shows that Solidigm has begun competitive promotion of IPO underwriting roles with investment banks, which indicates that the relevant plans have at least entered a more concrete preparation stage. However, neither SK Hynix nor Solidigm confirmed their final listing plans.
If Solidigm is listed at a valuation of US$150 billion, it will also mean that the company's capital market value far exceeds the approximately US$9 billion paid by SK Hynix when it acquired Intel's NAND business. Behind this huge change, it mainly reflects the obvious changes in the importance of enterprise-level storage business and investors' demand for AI infrastructure-related assets after the rapid expansion of AI data centers.
However, Solidigm's IPO still faces multiple uncertainties. First of all, the issuance size and valuation of the IPO ultimately depend on the capital market environment at the time of listing; secondly, the NAND flash memory market itself is highly cyclical, and memory chip prices, supply and demand relationships, and the speed of AI infrastructure investment may all affect the company's profitability and market valuation.
In addition, SK Hynix has incorporated Solidigm into its own storage business system for a long time. If Solidigm is independently listed in the future, external investors will share the economic rights and interests of this part of the business through shareholding. Therefore, the post-listing equity structure and SK Hynix's shareholding ratio will also become issues of concern to the market.
At present, Solidigm has not officially announced the IPO timetable, nor confirmed the final issuance size and valuation. According to current information disclosed by people familiar with the matter, the listing plan, which may be carried out as early as 2027, is still in the preparatory stage. Whether it can ultimately be realized and the specific method to be adopted still needs to wait for further formal decisions from SK Hynix and Solidigm.
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Solidigm, a subsidiary of SK Hynix, is reportedly evaluating building a NAND flash memory factory in the United States
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