Shein Eyes Mid-Year London IPO Amid Regulatory Hurdles

Fast-fashion giant Shein is reportedly aiming for a London IPO in the first half of 2024, Reuters reports. The move comes after the company withdrew its US IPO amid congressional concerns about China-related risks and alleged labor malpractices.

Reuters cites two sources familiar with the matter to report that Shein is targeting a London listing as early as Easter. The success of the IPO hinges on regulatory approvals from both the UK and China. A trip to China by Britain's finance minister, Rachel Reeves, could facilitate these approvals, with the head of the Financial Conduct Authority (FCA) accompanying her to meet with Chinese regulatory partners.

"The IPO could be completed as early as Easter, which is April 20, one of the people said," Reuters reports, citing one of the sources. "A visit to China by Britain's finance minister Rachel Reeves starting on Saturday, during which she will meet with vice premier He Lifeng to discuss economic and financial cooperation, could help progress the regulatory approvals Shein needs, the source added."

Shein, founded in China in 2012, is currently headquartered in Singapore but requires permission from the China Securities Regulatory Commission (CSRC) for its offshore listing. New rules passed by the CSRC in 2023 grant the authority to vet and potentially block offshore listings. The CSRC has yet to comment on the UK's visit or Shein's IPO plans.

The London listing bid reflects Shein's efforts to navigate geopolitical complexities. The company's general counsel for Europe, the Middle East, and Africa declined to directly answer a British parliamentary committee's question about whether its clothes contain cotton from China or Xinjiang, highlighting the sensitive nature of the issue. The US has accused the Chinese government of forced labor and other abuses against Uyghur people in Xinjiang, a major cotton-producing region. Beijing denies these allegations.

"Shein's general counsel for Europe, the Middle East and Africa, Yinan Zhu, on Tuesday declined to directly answer when asked by a British parliamentary committee whether the retailer's clothes contain cotton from China or Xinjiang, or whether it tells suppliers not to source from the province," Reuters reports. "Zhu asked instead to provide the committee with written answers, and said Shein complies with relevant laws in all jurisdictions."