Shoppers at a Shein pop-up store in Canada. The online retailer faces scrutiny over labour practices. Photo / Allen J. Schaben, Los Angeles Times via Getty Images
Shoppers at a Shein pop-up store in Canada. The online retailer faces scrutiny over labour practices. Photo / Allen J. Schaben, Los Angeles Times via Getty Images
Online fast-fashion group Shein has filed confidential paperwork for an initial public offering with the UK’s markets regulator, said two people familiar with the matter.
The move is taking Shein a step closer to what could be a blockbuster listing for London, following the company’s decision to ditch aplanned IPO in New York. The Chinese-founded group could fetch a market valuation of about £50 billion (NZ$103b).
Shein, which grew in popularity during the coronavirus pandemic when millions of people switched to online shopping, submitted the pre-listing documentation with the Financial Conduct Authority earlier this month, said one of the people.
The filing is a precursor to the Singapore-domiciled company releasing its IPO prospectus, which the UK regulator would have to approve before the listing.
Shein, whose majority of staff and manufacturing are located in China, has yet to receive approval from China’s authorities to list in London.
The company could decide to sell shares for the first time elsewhere if it faced regulatory hurdles or better listing conditions somewhere else, the people briefed about the matter cautioned. A Hong Kong listing is another option under consideration, they added.
Donald Tang, Shein’s executive chair, told the Financial Times last month that the company had made “progress” on changing the perception that Beijing controlled it “but not enough” to win over US lawmakers.
A possible IPO would be a much-needed boost for the UK market.
Senior UK politicians including Conservative chancellor Jeremy Hunt and Labour shadow business secretary Jonathan Reynolds have met with the company in recent months.
Labour, which is leading in the polls for general elections on July 4, has argued London should welcome a Shein flotation because it would impose higher regulatory standards on the company than elsewhere.
Britain's Labour Party shadow chancellor Rachel Reeves and shadow secretary of state for business and trade Jonathan Reynolds during a press conference while on the general election campaign trail earlier this month. Photo / Lucy North, PA via AP
Shein has faced allegations of forced labour in its supply chain, which it denies, saying it “has a zero-tolerance policy for forced labour”.
Asked about a potential London listing for Shein on Monday, Reynolds said: “If they’re doing business in the UK we should ideally seek to regulate them from the UK...So if a listing was to be considered I want that [to be in the UK] because I would know that is the way we could enforce the highest standards.”
Business secretary Kemi Badenoch said there were issues that her party would want to look at if the company were to list, citing potential “lost” taxes because of its business model and concerns over forced labour in China.
But speaking after Badenoch and Reynolds, junior business minister Kevin Hollinrake said of the Shein IPO that it “would be a prize to have that kind of listing in the London Stock Exchange”.
Requirements for UK companies to report on modern slavery in their supply chains could make the company “more accountable”, he added.
