China Owned Online Fashion Retailer Shein Eyes US IPO
Shein, a $60 billion Chinese online fashion retailer, seeks to go public in the US, facing labor practice scrutiny and geopolitical tensions.
Chinese fashion retailer Shein, valued at over $60 billion, has taken a significant step towards its initial public offering (IPO) in New York, as reported by insiders familiar with the matter.
The company has registered with regulators, aiming to become the most valuable Chinese firm to go public in the United States since Didi Global's listing in 2021. However, Shein's IPO plans face obstacles, including allegations of labor practices and growing tensions between the US and China.
According to anonymous sources, Shein has confidentially submitted its IPO registration with the US Securities and Exchange Commission (SEC). If successful, the IPO could take place before the end of 2023. Notably, Didi Global faced delisting a year after its IPO due to regulatory crackdowns by Beijing on Chinese technology companies.
Responding to the news, a Shein spokesperson denied the rumours but did not provide further details. The SEC declined to comment on the matter.
Despite escalating trade disputes, technological concerns, and human rights issues, Shein is determined to proceed with its IPO plans. However, the bipartisan group of two dozen US representatives has voiced opposition, urging the SEC to verify Shein's labor practices before granting approval for the New York listing. Shein has repeatedly stated that it adheres to ethical sourcing standards and refutes allegations of using forced labor from China's Xinjiang region. Notably, the US prohibits exports from Xinjiang due to forced labor concerns.
In addition to labor-related scrutiny, US lawmakers are also targeting the "de minimis" tariff exemption, commonly used by e-commerce retailers like Shein to ship orders from China to the United States. A federal brief in April accused Shein of exploiting this exemption to avoid duties and import illicitly made goods.
With investors such as General Atlantic, Mubadala, Tiger Global, and Sequoia Capital China, Shein was valued at over $60 billion in a recent private fundraising round. Over the past three years, Shein has been eyeing a US IPO. However, various challenges, including US scrutiny of Chinese accounting practices and market volatility caused by the COVID-19 pandemic and geopolitical conflicts, have delayed its plans. To navigate China's stringent regulations on overseas listings, Shein relocated its headquarters from Nanjing to Singapore over a year ago.
Shein, the Chinese online fashion retailer valued at over $60 billion, has registered for an IPO in New York.
The IPO aims to make Shein the most valuable Chinese company listed in the US since Didi Global.
Shein faces scrutiny over labor practices and geopolitical tensions between the US and China.
The company denies allegations of using forced labor and seeks to comply with ethical sourcing standards.