Shein is reported to be accelerating its plans for a London Stock Exchange listing after its efforts to float in New York met pushback and regulatory obstacles from US lawmakers.
Sources told Reuters that Shein is expected to update China’s securities regulator on the IPO change and move to London “as soon as this month”.
The fashion retailer confidentially filed for an IPO with the US Securities and Exchange Commission in November, and approached the China Securities Regulatory Commission (CSRC) for permission to file, sources added.
While Shein is prepared for a London IPO, a plan for a US IPO is still alive and preferred, but it is facing regulatory hurdles in the US and China.
It is reported that the CSRC informed Shein that the regulator “would not recommend” a US IPO due to Shein’s “supply chain issues”.
Sources told Reuters that the fashion retailer was valued at $66bn (£52.6bn) in a fundraising last year and that it started to communicate with the London-based teams of its financial and legal advisers to explore a listing in London earlier this year.
If Shein updates the Chinese regulator on the London IPO, it would be subject to Beijing’s approval under the new listing rules for Chinese firms going public offshore.
As Shein does not own or operate any manufacturing facilities and instead uses over 5,400 third-party contract manufacturers, mainly in China, that makes it subject to the CSRC listing rules.
Under new rules, other Chinese authorities including the National Development and Reform Commission, which supervises foreign holdings in local firms, the cybersecurity regulator and others may have to support in approving offshore IPO applications.
Another source added that the Cyberspace Administration of China has been conducting a “procedural cybersecurity review of the company’s data handling and sharing practices”, predominantly about information on its suppliers in China, as part of the IPO clearance process.
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