Fast-fashion giant Shein is reportedly exploring plans to pivot its upcoming IPO by listing in London instead of New York, in what would come as a major boost for the U.K.’s main stock market following a departure of significant listings over the previous year.
Shifting Focus to London
The Sino-Singaporean company first filed for a New York IPO in November 2023, but is now considering shifting the float to London, in seeking to avoid the heightened scrutiny it has faced in the U.S. over its operations in China, sources told Bloomberg.
Scrutiny and Challenges
In February, Republican Senator Marco Rubio accused Shein of having submitted incomplete information in its IPO filing, as he called on the Securities and Exchange Commission (SEC) to block the float unless the company makes “enhanced disclosures.”
Rubio’s calls followed the submission of a letter from a group of 22 bipartisan members of the U.S. House of Representatives in which they called on the SEC to probe allegations that Shein uses forced and underpaid labor in Xinjiang in its supply chains.
Boost for London Stock Exchange
A new listing in the U.K. would come as a boost to the London Stock Exchange which has suffered over the past year from a series of companies either leaving Britain’s top bourse or instead avoiding the market entirely.
SHEIN AIMS FOR $80-$90 BILLION VALUATION
London’s Largest Ever IPO on the Horizon
Shein, renowned for its affordable fashion offerings like $2 bikinis, is reportedly setting its sights on a valuation between $80 and $90 billion. If the U.K. listing comes to fruition, this IPO would mark one of London’s largest ever.
Recent Shifts in Listing Choices
Investors recently approved Tui’s plans to depart from the London listing scene, opting for Frankfurt instead. ARM Holdings’ decision to list on the Nasdaq over the LSE in August 2023 dealt a blow to the U.K. markets despite government efforts to sway the tech giant.
Ireland’s Top Firms Make Moves
Notable moves include CRH and Smurfit Kappa shifting their main listings to the New York Stock Exchange in 2023, dealing further blows to London’s stock market.
Concerns of a “Doom Loop”
Anxiety looms over the London Stock Exchange’s future as the lack of IPOs leads to dwindling liquidity and subsequent low valuations, potentially causing a cycle that drives away investors.
