Shein files for IPO in Hong Kong after facing setbacks in US, UK listings

Shein's plan to go public in the US, and later in the UK, hit a roadblock due to growing scrutiny over its labour practices, data handling, and rising regulatory and geopolitical pressure

Fast-fashion retailer Shein has confidentially filed to go public in Hong Kong, as efforts to list in the US and UK face continued delays. The company submitted a draft prospectus to the Hong Kong Stock Exchange last week and is now seeking approval from China’s securities regulator China Securities Regulatory Commission (CSRC), according to a report by the Financial Times.

 

Goldman Sachs, Morgan Stanley, and JPMorgan are advising on the IPO. 

Shein, which moved its headquarters to Singapore but still relies heavily on Chinese manufacturing, had previously tried to list in the US and then in London. Both efforts have stalled due to political and regulatory challenges.

 

 

Shein US listing roadblock

In the US, Shein filed for an IPO in November 2023. However, the deal has run into growing resistance from lawmakers and regulators. The company has not been allowed to join the National Retail Federation and has faced questions from Congress about its data practices, ties to China, and labour conditions in its supply chain.

 

According to a report by CNBC last month, some US officials have raised concerns about the company’s links to China’s Xinjiang region. There are also worries about what kind of data Shein collects from US users and whether it could be accessed by the Chinese government. In December, a congressional panel sent the company a letter asking for more information on its data policies and relationship with Beijing.

 

Shein has denied allegations of forced labour and says it follows US laws. The company has also come under fire for using shipping loopholes to avoid import taxes by sending packages directly to customers in the US.

 

With political pressure building, media reports indicate that a US listing looks unlikely.

 

 

Shein’s UK IPO bid falters on CSRC objections

After the US filing stalled, Shein turned to London. The UK’s Financial Conduct Authority approved a draft of its prospectus, but China’s CSRC raised objections, mainly around how the company described risks related to its Chinese operations and Xinjiang. Talks between the two regulators have not produced a resolution. 

Hong Kong is now seen as a more realistic path as Chinese regulators have been encouraging domestic firms to list closer to home. If the Hong Kong listing is approved by both the CSRC and HKEX, it could allow for a future secondary listing in London, though that would still depend on regulators aligning, the report by the Financial Times noted.