Shein's IPO could move from New York to London. (Allen J. Schaben / Los Angeles Times via Getty Images)Los Angeles Times via Getty Images
After the long, and some would say endless, saga of fast fashion retail giant Shein's IPO, London could end up beating New York.
According to a weekend report in British newspaper The Daily Mail's “This Is Money,” Shein could announce the London Stock Exchange (LSE) as the destination for its IPO in a few days.
Directors of the Singapore-based fashion giant are believed to be close to choosing London over New York for the high-profile listing.
Early last year, the company had expanded its Singapore office after making a Singapore firm its de facto holding company, amid a flurry of applications from the online fast fashion retailer, with additional reports that the founder and CEO of Shein, Chris Xu, became a permanent resident of the city-state.
It was widely speculated that this was to avoid growing regulatory opposition to China-based companies seeking to go public in the US
According to Chinese corporate filings, Shein previously deregistered its main business, Nanjing Top Plus Information Technology Co Ltd, and these developments are said to bolster previous rumors that Shein was seeking to go public in New York.
However, in February last year, Reuters reported that the company had put its plans to go public in the US on hold amid persistent rumors that it was preparing for an initial public offering.
The Times also reported this weekend that London was the likely leading candidate for an IPO, with Shein seeking a valuation of about $88.5 billion, putting the company among the LSE's top six companies by valuation.
Shein IPO in London
It is understood that the Shein board has concluded that the political climate means that a US application may well be rejected. Meanwhile, British Finance Minister Jeremy Hunt spoke out last month when he met Shein Chairman Donald Tang to persuade him to commit to one of London's biggest IPOs if it goes ahead.
Times Square district of New York. Photographer: Yuki Iwamura/Bloomberg© 2023 Bloomberg Finance LP
It also comes at a time when the LSE has missed out on a number of high-profile IPOs and rules have been tweaked twice in recent years to attract IPOs from technology companies. These were part of wider reforms to maintain London as a globally competitive financial center post-Brexit.
However, these reforms have not yet encouraged an influx of new issuance, as no IPOs were completed in the fourth quarter of last year and 2024 is hardly busier.
After announcing its first design collaboration with Forever 21 late last year, Shein in turn increased its stake in the UK market by acquiring the Missguided brand name from parent company Frasers Group.
The acquisition comes just over a year after UK-based sportswear and fashion group Frasers Group rescued the company from bankruptcy in a $24 million deal.
Shein acquired Missguided's intellectual property and brands, but not Missguided's real estate or employees, both of which were integrated into Frasers' broader fashion division.
Now the smart money awaits Shein's final decision on where to list its IPO in what is likely to be a heavily oversubscribed public offering.
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I'm a global retail and real estate specialist who looks behind the headlines to find out where retail is headed. I work as editor-in-chief for MAPIC and editor for the World Retail Congress, two of the largest annual international retail events. I also organize, speak and lead conferences around the world, focusing on how people are changing and what that means for the retail, food and beverage and leisure industries. And it's complicated! Forget the tired mantra that online has killed stores, and instead remember that retail has always been a cutthroat enterprise: star names rise and fall quickly, and only retailers that embrace change will survive. Don't think it's not important, your pension funds own these malls!
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