Shein’s £50bn London float in jeopardy

24th June 2024

Georgia Wright

Fashion

Shein could cancel its planned £50bn London listing amid growing concerns in Beijing about how the fast fashion giant is being portrayed in the UK, despite Reuters reporting that Shein confidentially filed papers with the UK’s Financial Conduct Authority in early June for a potential London listing.

It is understood that some high-ranking Chinese government officials are irked by the criticism it has faced, according to The Mail on Sunday. Attacks on the brand have come from some politicians, as well as the press, other retailers and investors.

The Mail on Sunday recently revealed the British Fashion Council’s concerns over the blockbuster float.

The trade body said the listing was a “significant concern” to the industry and that “questions remain” about its business practices.

BFC chief executive Caroline Rush told This Is Money: ‘At a time when global fashion leaders are rightly focused on making our sector more socially, environmentally, and economically sustainable, the Government’s courting of Shein to list on the London Stock Exchange, and Shein’s decision to do so, is of significant concern to UK fashion designers and retailers.”

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A backlash from the US trade body, the National Retail Federation, was one of the reasons Shein is understood to have abandoned its initial plans to go public in New York.

Shein has been criticised for using suppliers who exploit low-paid garment workers to sell its clothes at knockdown prices.

In 2022, a Channel 4 undercover investigation into factories supplying Shein showed that factory workers were working up to 18 hours a day including at weekends, and had just one day off per month, while being paid 3p per garment.

While the group is based in Singapore, its cut-price fast fashion is manufactured in China. As a result, it needs approval from Beijing regulators to list its shares in London.

They are believed to have created obstacles for Shein’s plans to list in New York due to worsening business relations between China and the US.

According to a source, Beijing authorities might now push Shein to list in Hong Kong instead of London.

Shein’s London float would provide a huge boost to the London Stock Exchange, which has been hit with an exodus of companies and lack of blockbuster listings.

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