SK Hynix Shares Begin Mutual Conversion Between Korean Stock and U.S. ADR on July 29, 25% Premium Expected to Narrow

According to Korea Securities Depository, SK Hynix announced on July 18 that mutual conversion between its Korean-listed shares and U.S. Nasdaq ADRs will be available starting July 29, the listing date of new ADR shares. The conversion will allow investors and Citibank, the depositary institution, to submit conversion requests, with specific schedules to be announced by Citibank.

On July 15, SK Hynix ADRs closed at $176.46, representing approximately 25% premium over the same day's Korean closing price of 2,082,000 won. Market participants expect this premium gap to narrow as arbitrage opportunities emerge through the conversion mechanism. The company's ADS custodial limit is set at 1.78 billion shares, representing 25% of issued stock, with an additional 22.5% conversion capacity available after accounting for the 2.5% already issued ADRs during the July 10 Nasdaq listing.