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SK Hynix has established a maximum threshold, setting the upper limit at 2.5% of its total issued share capital, for the volume of shares listed on the Korea Exchange that can be converted into American Depositary Receipts (ADRs). Presently, the entire conversion quota has been fully utilized, following the issuance of ADRs worth US$26.5 billion. Unless current ADR holders opt to convert their American Depositary Receipts back into domestic Korean shares, investors will find themselves unable to proceed with further exchanges of Korean shares for ADRs. Considering that SK Hynix's ADRs have consistently traded at a premium compared to the shares listed on the Korea Exchange, the imposition of conversion quota restrictions is likely to exacerbate and prolong the price disparity between the two markets.
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