SK hynix has effectively secured the position of the largest shareholder in Japanese NAND flash memory maker Kioxia after a special purpose company backed by the South Korean chipmaker overtook Toshiba as Kioxia’s top shareholder.
According to a filing Kioxia submitted to the Tokyo Stock Exchange on Aug. 10, Toshiba reduced its stake from 14.48% to 14.12%, while Bain Capital-affiliated Bain SPC2 maintained a 14.19% stake, making it Kioxia’s largest shareholder.
SK hynix holds convertible bonds issued by Bain SPC2 that give it the right to acquire all of the SPC’s voting rights once the bonds are converted into shares. This means SK hynix has effectively secured a path to Kioxia’s largest shareholder position, although it does not currently exercise voting rights.
The development traces back to 2018, when SK hynix joined a Bain Capital-led consortium to acquire Toshiba Memory, now known as Kioxia. Under the investment agreement, SK hynix agreed not to hold more than 15% of Kioxia’s voting rights until 2028 without Kioxia’s consent.
The latest change therefore does not mean that SK hynix has immediately gained management control over Kioxia. Conversion of the convertible bonds into shares would require regulatory procedures related to antitrust, foreign exchange and foreign trade in relevant jurisdictions.
Still, the shift is attracting attention as the strategic value of Kioxia has risen amid the rapid expansion of artificial intelligence infrastructure. While SK hynix is a global leader in high-bandwidth memory, Kioxia is a major player in NAND flash and solid-state drives, components increasingly important for AI data centers and large-scale data storage.
Industry observers say the development could give SK hynix greater strategic flexibility in the global memory market without requiring an immediate direct acquisition of Kioxia.
For SK hynix, what began as an investment in Toshiba’s memory business eight years ago has evolved into a potentially valuable strategic option as the memory industry undergoes another major transformation driven by AI.
