Fashion Retailer Shein Confidentially Files For U.S. Public Offering

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Topline

Online fashion retailer Shein has made a confidential filing to go public on the U.S. stock market, according to reports, potentially signaling one of the biggest initial public offerings of the last few years.

Key Facts

The company—founded in China but now headquartered in Singapore—is targeting a $90 billion valuation, Reuters and Bloomberg reported.

The company has picked Goldman Sachs, JPMorgan Chase and Morgan Stanley as underwriters for the public offering, which will likely take place in 2024.

Shein, which surged in popularity during the Covid-19 pandemic, has managed to disrupt fast fashion rivals like H&M and Zara with its wide inventory of low-priced apparel.

The fashion retailer operates in over 150 countries, but according to the Wall Street Journal, the U.S. is its biggest market.

Forbes has reached out to Shein for comment.

Big Number

$66 billion. That is the valuation at which Shein raised capital in the most recent fundraising round in May this year. This was a step down from the $100 billion valuation the company had raised funds at a year prior.

What To Watch For

If Shein hits its purported IPO target valuation of around $90 billion, it will surpass ride-hailing platform Didi’s $68 billion valuation on debut in 2021 to become the biggest listing by a Chinese-founded company in the U.S.

Surprising Fact

Shein accounted for around 50% of all sales among major fast fashion companies in the U.S. in November last year, according to Bloomberg data. The next closest competitor H&M accounted for 16% of sales and Zara was at 13%.

Key Background

Shein’s meteoric rise in the past few years has not been free from controversy. The company has been accused by major fashion brands and independent designers of stealing designs and intellectual property. The company was hit with a federal racketeering lawsuit in July, where a group of independent designers accused the company of profiting from a “continuous pattern” of theft. The company has also been accused of human rights violations and poor labor practices in its Chinese factories. This prompted lawmakers to demand an intervention by the SEC and a third-party audit of labor practices at Shein’s factories. The company, however, has strongly denied the allegations, saying it has zero tolerance for forced labor.

Further Reading

China’s Shein files for US IPO in major test for investor appetite (Reuters)

Fast-Fashion Giant Shein Files to Go Public (Wall Street Journal)

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