[News] SK hynix-linked BCPE Pangea Cayman2 Becomes Kioxia’s Largest Shareholder; Influence Under Scrutiny
SK hynix, the world’s second-largest NAND maker, has indirectly become the largest shareholder of Kioxia, the third-largest NAND player. Citing Nikkei, ZDNet reports that Bain Capital’s special-purpose vehicle (SPC), BCPE Pangea Cayman2, has overtaken Toshiba after the Japanese conglomerate trimmed its Kioxia stake. The SPC now holds 14.19%, or 77.4 million shares, slightly above Toshiba’s 14.06%, Nikkei adds.
According to ZDNet, SK hynix invested roughly 4 trillion won in Kioxia in 2018 through two SPCs. While SPC1, jointly funded with Bain Capital and others, was fully sold in June after Bain exited, SK hynix has retained SPC2, into which it invested about 1.3 trillion won, ZDNet suggests.
The shift comes as SK hynix Group and Kioxia remain locked in a close NAND market race. TrendForce data shows Samsung led the market in 1Q26 with a 31.6% revenue share, up from 28% a quarter earlier, while SK hynix Group ranked second at 17.6% and Kioxia third at 13.9%. Against this backdrop, SK hynix’s indirect rise to Kioxia’s largest shareholder adds a new strategic dimension to the NAND market’s competitive landscape.
SK hynix’s Growing Influence Draws Scrutiny
Notably, Bloomberg highlights that SK hynix’s growing influence over Kioxia could create a potential conflict of interest for the Japanese NAND maker. Citing Kioxia’s annual report, Bloomberg reports that SK hynix holds bonds that could be converted into “substantially all” of the voting rights in BCPE Pangea Cayman2. Kioxia explicitly identifies SK hynix’s position as a risk factor, citing the potential conflict of interest arising from the Korean rival’s growing influence.
That influence, however, remains subject to a voting-rights cap. SK hynix joined a Bain Capital-led consortium that acquired Kioxia in 2018 and agreed under the deal to limit its voting rights to 15% through 2028, unless Kioxia approves a larger stake, Bloomberg suggests.
On the other hand, The Bell also points out that SK hynix is unlikely to gain a direct role in the company’s management anytime soon. As explained by the report, converting its CB holdings into shares would require merger reviews by competition authorities across multiple jurisdictions. Japan could pose an especially significant hurdle, given the government’s sensitivity to protecting its domestic semiconductor industry, the report adds.
Despite these hurdles, industry observers cited by Seoul Economic Daily expect SK hynix to retain the SPC2-held CBs for the time being. The company is reportedly weighing how best to leverage the investment, which could serve both as a strategic tool to keep a rival in check and as a valuable investment asset.
Toshiba Trims Kioxia Stake Amid Restructuring
SK hynix’s rise to Kioxia’s largest shareholder comes as Toshiba continues to trim its stake in the NAND maker. According to the disclosure cited by Seoul Economic Daily, Toshiba sold 5.436 million Kioxia shares on the open market between July 22 and August 3, cutting its holdings from 82.4742 million shares to 77.0382 million. Its stake consequently fell 1.04 percentage points, from 15.10% to 14.06%.
The latest sale could be regarded as part of Toshiba’s broader effort to streamline its finances and restructure its business following its acquisition by a Japan Industrial Partners (JIP)-led consortium in 2023, the report notes, adding that since Kioxia’s listing, Toshiba has steadily trimmed its stake as part of that ongoing restructuring.
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(Photo credit: Kioxia)
