Samsung ADR US listing ruled out by the company for now

After its rival SK Hynix raised $26.5 billion by listing its stock ADRs in the United States, there was some speculation that Samsung Electronics could similarly tap into the markets while also making it easy to buy Samsung stock in the United States.

That option is off the table for now. The company said during its earnings conference call today that it currently has no plans to list ADRs in the country.

Samsung acknowledged during the conference call that there are benefits to ADR listing. It would enable the company to raise more capital while also expanding the investor base.

It believes that the assessment should also consider whether listing ADRs would benefit all shareholders who have invested in the company over the long term.

“Given our cash-generation capabilities supported by a diversified business portfolio, the need for an ADR listing is currently not particularly high. Although some media reports have raised the possibility of a U.S. listing, we are not currently considering issuing ADRs,” the company said.

Samsung Electronics is a vastly different business than SK Hynix, which primarily supplies memory chips. Samsung does everything from consumer electronics, mobile devices, contract chipmaking, memory supply, packaging services, and a lot more. It can generate cash through a lot of those businesses which can then be used to fund expansion, research and development.

So while US investors would particularly miss having an easier way to buy Samsung stock, the signal from the company is clear, it's not interesting in an ADR listing as yet.