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The Shein boss has held talks with Jeremy Hunt about a potential multi-billion pound London stock market listing that could give the beleaguered stock market a big boost.
Donald Tang met with the Chancellor earlier this month and raised the possibility of the City taking away the China-founded fast fashion giant’s initial public offering (IPO) from New York.
Reports suggest the company, now based in Singapore, could be valued between £40bn and £70bn, setting the stage for what could be Britain’s biggest ever stock float.
It would represent a much-needed victory for ministers and city bosses who have been fighting to revive London’s status as a global listing venue after a series of blows such as the decision by Cambridge-based chip designer Arm Holdings to head to New York.
IPO: Reports suggest fast fashion group Shein could be valued between £40bn and £70bn, setting the stage for what could be Britain’s biggest IPO.
According to Bloomberg data, only around £800 million in IPOs were raised in the UK last year due to a dearth of companies coming to market.
Shein has already filed for a listing in the United States, but has faced opposition from people such as Florida Senator Marco Rubio, in part due to claims that it has used cotton sourced from forced labor in China’s Xinjiang region.
Shein has said it has a “zero tolerance policy toward forced labor.” That opposition has forced him to look for alternative spaces, although he could face similar scrutiny in the United Kingdom.
However, any move to float Britain is likely to be hailed as a victory for those pushing a series of reforms to make it easier and faster to list on the stock market.
A Treasury spokesperson said: “We have developed reforms to boost the UK as an IPO destination, including making it easier for companies to list more quickly.” The spokesperson said the Government did not comment on individual companies.
Founded in 2012, Shein has enjoyed rapid expansion, thanks to its popularity among younger, budget-conscious shoppers in more than 150 countries, using what it describes as a unique business model and efficient supply chain to maintain low prices.
It enjoys global sales of more than £20bn, including £1.1bn in the UK.
Last year, Shein bought British brand Missguided and opened an office in Manchester.
Tang, the company’s chief executive, reportedly held talks with the London Stock Exchange in December about the possibility of a London IPO.
He met the Chancellor earlier this month and the two men held “productive” talks, according to Sky News.
The introductory meeting was requested by Tang, a government source said, adding that he had raised the possibility of an IPO.
It was a question for him, the London Stock Exchange and the regulators whether this went ahead, the source added.
Danni Hewson, head of financial analysis at brokerage AJ Bell, said: “Having one of the most disruptive names in retail in the UK would certainly do wonders to help repair the London Stock Exchange’s damaged reputation as a place of listing”.
“Investor interest could be huge, which bodes well for attracting other names to list in the UK after a patchy period.”
But the Inter-Parliamentary Alliance on China, a global cross-party group of lawmakers campaigning for democracies to stand up to Beijing, expressed alarm.
Chief executive Luke de Pulford said: “It is sad to see how far the UK has sunk in such a short time – from a world-leading nation in modern slavery to a haven for companies rejected by our allies on ethical grounds.”