Shane is increasingly likely to choose London as the location for its IPO. (Allen J. Schaven/Los Angeles Times) … [+]
Shein, the Singapore-based online fashion giant, is expected to file paperwork for what could be London’s biggest ever stock listing, possibly as soon as this week.
Having faced repeated thwarted attempts to list in the US amid an increasingly chilly business relationship between the US and China, Shein, which was valued at $66 billion at the time of a fundraising last year, was widely reported over the weekend to be confidentially filing a prospectus with the UK Financial Conduct Authority to list on the London Stock Exchange.
A listing would not only put an end to retail’s longest-running IPO debate, but would also be a major boost for the London Stock Exchange, which has recently fallen out of favour as a destination for large companies to list.
But just like in the U.S., a listing could be a political grenade. Shein’s possible opt for a London listing comes after an initial attempt to list in New York was thwarted by a number of politicians and industry regulators concerned about tensions between Beijing and Washington.
Politicians support Shein’s listing
Jeremy Hunt, the current UK Chancellor of the Exchequer, met with Shein’s executive chairman Donald Tan earlier this year in an attempt to persuade the retailer to list in London after it had abandoned a New York listing.
But if the polls are correct, the future of the Conservative government in the UK is likely to be short-lived, with a general election to be held on July 4th that is widely expected to return the Labour Party to power.
That’s why Jonathan Reynolds, the Opposition’s Shadow Business Secretary, [who would become the government business secretary if Labour wins]Additionally, Shadow Industry Secretary Sarah Jones and Shadow Creative Industries Secretary Chris Bryant also met with Tan recently to discuss a possible listing.
according to TimesIf Labour takes power next month, it is likely to support a UK listing for Shain. While the planned filing of a prospectus does not guarantee the company a UK listing, it would be an important next step towards a London listing, according to broadcaster Sky News.
Lawmakers question Shane
But like in the U.S., some senior British lawmakers have also questioned whether Shein is suitable to be listed on the London Stock Exchange and called for greater scrutiny of the company’s operations. Shein has been at the center of controversy over its use of cotton from China’s Xinjiang Uighur Autonomous Region and other issues about labor rights in its global supply chain.
Shain’s global supply chain is under scrutiny in both the US and UK
Shane responded by arguing that it has strengthened governance and compliance and has worked to improve its environmental record.
The fast fashion retailer made a profit of more than $2 billion last year, nearly double the $1.1 billion it recorded just two years ago in 2021, and is estimated to be valued at more than $63 billion if it lists in the UK.
The listing, now expected to likely take place this summer or early fall, would break all records and surpass the previous biggest London listings, when commodities company Glencore listed for $48.3 billion in 2011 and Haleon, which was spun off from GlaxoSmithKline’s consumer goods division, for $38.7 billion in 2022.
