SK Square Co. unveiled a 200 billion won ($143 million) share buyback initiative as the South Korean holding company faces mounting pressure to narrow the discount between its market value and its SK Hynix Inc. stake.
The firm plans to cancel 100 billion won of shares purchased in April and buy back an equal amount over the next three months, according to a company statement Thursday. The move follows engagement with Palliser Capital, a London-based hedge fund that acquired a 1% stake and pushed for changes to address undervaluation.
SK Square’s market capitalization stands at less than half the $18 billion value of its 20% holding in SK Hynix, which has surged on artificial intelligence chip demand from Nvidia Corp. The company’s actions align with South Korea’s “Value-Up” program, a government initiative to boost local stock valuations.
The Korea Exchange recently introduced an index tracking companies actively working to increase shareholder returns, part of broader efforts to reshape the country’s equity markets.
SK Square also plans to nominate an independent director, responding to calls for improved corporate governance.
