Shein shifts focus to London following the failure of her New York IPO

Shein will list in London in the next few months, as tensions between Washington DC and Beijing have slowed down plans to launch a major IPO in New York.

Donald Tang, the executive chairman of the Singapore-domiciled company, said in an interview that the Singapore-domiciled firm had made “progress”, but not enough to convince US lawmakers.

Shein has faced the greatest obstacle to its initial publicly traded in the US. It filed the necessary paperwork six months ago.

People familiar with the company’s thinking have said that it has begun to prioritize its backup plan of a UK flotation.

Tang refused to confirm the possibility that would list in London and said the on-demand ecommerce company, , valued $66bn during its last funding round. Tang also stated the group had not yet decided on the listing venue. He said, “We are exploring all options.” “No decision has yet been made.”

A flotation the size of Shein would be a victory for the London Stock Exchange. It has been losing listings in recent years to its more liquid and larger New York competitors, the New York Stock Exchange, and Nasdaq.

In recent years, London has lost out on a number of high-profile listings. One example is Cambridge-based Arm Holdings. The betting company Flutter left the FTSE 100 to list in New York.

According to two people who are familiar with the situation, Shein has begun to shift its focus to London. They cited Shein’s founder Sky Xu “strong wish” to launch an IPO as soon as possible.

People who are familiar with the situation say that China’s securities regulator has not yet approved a New York IPO. The SEC, on the other hand, had not recently communicated with Shein. This leaves Shein with few details about the prospect of a US listing. It was not clear whether the China Securities Regulatory Commission will approve a UK float.

CSRC and SEC have not responded to comments.

Shein has, however, been “encouraged by London’s embrace” of the company. The company has held high level meetings with LSE and UK officials including Chancellor Jeremy Hunt.

One person said that Shein, if initially opting for the UK, would then aim to have a secondary listing on New York.

The company was established in China, and the majority of its suppliers reside in that country. It is now headquartered Singapore and doesn’t sell any of its products in China.

Tang stated that he did not feel “time pressure”, but Shein’s aim remained the same: to find a listing which could attract international investors. He said the primary goal was not to raise cash, give early investors an opportunity to exit, or create a currency that could be used for acquisitions. Its priority was to show skeptics how transparent it was.

What could be a better way to increase transparency than by establishing a publicly traded company? Right? “The whole world will be watching you in the public aquarium,” Tang said. “We want scrutiny.”

Chinese regulators have taken a cautious approach to the Shein case, since it is the first major test of the new regime introduced by the government in March 2013 for overseas listing of local companies.

Shein’s investors stated that they expected approval from the CSRC to be forthcoming but did not know why it took so long.