SK Hynix eyes $12 billion special dividend from Kioxia windfall
SK Hynix may pay a special dividend of about $12 billion from its Kioxia stake sale gains, Dong-A Ilbo reports, with third-quarter earnings due Wednesday.
Shareholders, sit up straight. SK Hynix is pursuing a special dividend of around 16 trillion won ($12 billion), Dong-A Ilbo reported Monday, funded by the sale of its stake in Japanese NAND maker Kioxia. The plan would return about 80% of the gain to investors.
The scale is dazzling. That is roughly 7 times the 2.1 trillion won the company paid in dividends last year. Per share, Dong-A puts it near 23,000 won, against a regular annual dividend of 1,500 won. Bloomberg, citing a report, said the gain was about $15 billion. Dong-A says the company is also weighing whether to pay in installments.
How did a 2018 investment of 395 billion yen turn into this? Kioxia's stock climbed from around 10,000 yen late last year to a record 112,700 yen on June 22 (pre-split), and Dong-A estimates SK Hynix's gain at about 20 trillion won excluding principal. For context, the company finished a 40 trillion won share buyback on October 21, a month ahead of schedule.
SK Hynix itself says only that it is "reviewing various shareholder return measures" and will announce them with third-quarter earnings on Wednesday. It did not elaborate. The market is already smiling: Global Economic reported the shares up 2.51% at 1,309,000 won in early Monday trading.
My take? After that breakneck buyback, a check this size would make quite a statement. Wednesday is the main event.
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Note the two multiples: the 16 trillion won dividend is about 7 times last year's payout, while the 20 trillion won gain is nearly 10 times, according to Yonhap. CNA notes that SK Hynix has not publicly disclosed details of the sale, so the gain is still an estimate.
Fifteen times the annual regular dividend per share, maybe in installments, maybe not. The company has not said which. Check the filing Wednesday.
