SK Hynix raises $1.5 bn in foreign bonds amid high demand

SK Hynix Inc., the world’s second-largest memory chipmaker, has raised $1.5 billion in foreign currency bonds, with the debt offering four times oversubscribed on growing expectations of a semiconductor industry recovery, according to investment banking sources on Tuesday.

The bond issuance, comprised of three and five-year notes, attracted $6.5 billion in bids from institutional investors.

The three-year notes of $500 million were sold with a coupon rate 1.45 percentage points higher than the corresponding US Treasury yield. The five-year bonds of $1 billion were issued at 1.67 percentage points above the five-year US Treasury yield.

Thanks to the strong demand, the spread between their coupon rates and US Treasury yields narrowed to a 0.4 percentage point from their initial price guidance.

The bond sale came after ratings agency S&P Global upgraded SK Hynix’s credit outlook to stable from negative last month while maintaining its triple B minus rating.

It was S&P’s first credit outlook revision for SK Hynix since downgrading it to negative in February of last year.


SK Hynix’s fresh bond issue bodes well for other Korean companies preparing to tap the global bond market for new capital, including SK On Co., POSCO Holdings Inc. and Hanwha TotalEnergies Petrochemical Co.

The chipmaker is among the biggest South Korean issuers in the global bond market. In January last year, it raised $2.5 billion in foreign bonds with maturities of three, five and 10 years. 

Industry observers see foreign bond issuance by South Korean companies picking up this year.

In 2023, domestic companies sold $53 billion worth of new foreign currency bonds, including $2.5 billion issued by the Export-Import Bank of Korea, according to the Korea Center for International Finance.

Of the total, non-state-controlled enterprises accounted for $9.2 billion, up 96% on-year.

“Korean bond issues are expected to attract investor interest amid the real estate crisis in China and geopolitical issues in the Middle East,” said Kim Joon-soo, an analyst at NH Investment & Securities. “Their foreign bond issues will likely gain traction.”

Write to Hyun-Ju Jang at blacksea@hankyung.com

Yeonhee Kim edited this article.