China's Shein Reportedly Sets Sights On US IPO Amidst Market Volatility And Geopolitical Tensions

Amidst market volatility and geopolitical tensions, China’s online retail giant Shein has set its sights on a potential U.S. Initial Public Offering or IPO, making waves in the fashion and investment worlds. 

What Happened: China-founded online retailer Shein is reportedly in discussions with at least three investment banks, including Goldman Sachs, Morgan Stanley, and JPMorgan Chase, about a potential IPO in the U.S., reported Reuters, citing people familiar with the matter. 

The B2C fast fashion e-commerce platform is also in talks with the New York Stock Exchange or NYSE and the National Association of Securities Dealers Automated Quotations or NASDAQ to determine the best listing venue.

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With a valuation exceeding $60 billion, Shein could become the most valuable China-founded company to go public in the U.S. since Didi Global’s debut in 2021. However, the timing of the IPO remains uncertain and sources suggest that Shein may decide not to proceed with the offering in the near future.

While Shein eyes its IPO plans, the company is facing scrutiny from U.S. lawmakers over its labor practices. A bipartisan group of two dozen U.S. representatives is urging an independent audit to verify that Shein does not utilize forced labor, particularly from the Uyghur minority group. 

In response, Shein has denied allegations of using forced labor and maintains that it adheres to ethical sourcing standards, the report noted. 

Although earlier reports suggested that Shein had filed its IPO registration confidentially with the U.S. Securities and Exchange Commission or SEC, it has been now reported that no filing has been submitted to the SEC at this time. 

Why It's Important: The founder of Shein, Chris Xu, relocated the company’s headquarters from Nanjing, China to Singapore over a year ago. 

This strategic move allowed Shein to navigate the challenges posed by China’s stringent rules on overseas listings and the geopolitical tensions between Beijing and Washington, as well as the U.S. scrutiny of Chinese accounting practices.

Previously, it was also reported that even amidst growing concerns and preparations to ban TikTok, four out of the top 10 most-downloaded apps in the U.S. are owned by Chinese companies. These apps include Temu, TikTok, CapCut, and Shein.

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