Why Korean Companies List in the US — Solidigm and Accounting Standards

Solidigm, a subsidiary of SK Hynix, has set up a dedicated team. Look at what the team does and the purpose becomes clear: preparing for a US stock listing.

But the first thing that team touches isn't an investor roadshow or a bank selection. It's the accounting books.

Why start with accounting?

Countries keep books by different rules. Korean companies generally use IFRS, the international standard. To list on a US exchange, a company must be able to report financials under US GAAP, the American standard.

Switching isn't a spreadsheet edit. Several years of past figures have to be recalculated, and accounting systems and internal controls need rebuilding. That's why listing preparation starts by gathering accountants. The existence of this team reads as a signal that preparation has moved from talk into execution.

Why go all the way to the US?

Capital, mostly. US exchanges pool more investment money than anywhere else. The same business is often valued more generously there, and the amount a company can raise is simply larger.

Customers matter too. Solidigm makes enterprise storage drives, and its major buyers are US data-center operators. Listing in the market where your customers live raises your profile and helps with hiring.

Honestly, it isn't the right move for every company. For a smaller firm earning most of its revenue domestically, the costs can outweigh what it gains.

What shareholders should watch

Spinning a subsidiary off into its own listing isn't automatically good for the parent company's shareholders. When a valuable business is separated and valued on its own, some of the value previously reflected in the parent's share price can migrate away. That's the recurring complaint behind Korea's duplicate-listing debate.

An overseas listing sits on different terms, though. How the proceeds are used and how much of the subsidiary the parent keeps change the picture substantially. Those details appear in the filings, so they can be checked rather than guessed.

Hiring an accounting team is roughly that early stage. No date, no size. But rewriting your books in American format suggests the decision itself has already been made.