Shein: could the year’s mega-IPO fall apart at the seams?
Latest hitch is a pre-float 'security review' that could deter potential investors
US stock markets might be flying, but the IPO market remains frozen, said The Economist: "for two long years, private companies have spurned public markets".
A big hope for Wall Street bankers is Shein, the outsized fast-fashion giant that confidentially filed to go public in the US in November – and even teased London about a possible listing. Shein is a financial prize worth having, said the FT.
'One of the biggest IPOs of 2024'
Most recently valued at $64bn (more than rivals Zara and H&M combined), it would be "one of the biggest IPOs of 2024". But concerns have been mounting about the Singaporebased company's Chinese roots, and its supply chain's human rights record.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.
Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
The latest hitch, said Gabrielle Fonrouge on CNBC, comes courtesy of China's powerful internet regulator, CAC, which has announced a pre-float "security review". This squarely positions Shein as a Chinese company, despite the outfit's efforts to distance itself. The move revives bad memories of DiDi Global, the ride-hailing giant that underwent a similar review days after listing in New York in 2021.
'Sustainability an ultimate IPO risk'
Within a year, it was "delisted and shareholder value was wiped out". Shein – which has never sold garments in China, but sources many of its products there – is taking flak from "both sides". Washington and Beijing both worry about "sensitive data" on customers, workers and partners being leaked to the other side.
Quite apart from geopolitics, Shein's IPO hopes face "an intractable challenge", said Lisa Jucca on Reuters Breakingviews: sustainability. All fast-fashion retail involves a lot of carbon-intensive, hard to recycle polyester-based garments. Shein's sheer size takes the problem to another level; growing unease about "textile pollution" makes it hard to defend. "Shein's waste factor is its ultimate IPO risk."
Create an account with the same email registered to your subscription to unlock access.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
-
Labor market strong as inflation sinks
Feature And more of the week's best financial insight
By The Week US Published
-
Midair blowout: another black mark for Boeing
Feature This isn't the first production issue Boeing has encountered
By The Week US Published
-
Behemoths of the seas
The Explainer Cruise liners keep getting bigger, with the world’s largest 'megaship' ever built set to make its maiden voyage this month.
By The Week Staff Published
-
Holiday season: Fed optimism cheers investors
Feature The feds believe their 'pivot' will make a recession unlikely
By The Week US Published
-
Older workers stay in the labor force
Feature And more of the week's best financial insight
By The Week Staff Published
-
America's most in-demand job
Feature And more of the week's best financial insight
By The Week US Published
-
Currency: the long reign of the mighty dollar
Feature Argentina is planning to drop the peso in favor of the US dollar
By The Week US Published
-
For Gen Z, money is not a taboo topic
Feature And more of the week's best financial insight
By The Week US Published