The plan by Chinese fashion retailer Shein to list in the US has been put on hold due to volatile capital markets amid heightened geopolitical tensions, two sources with direct knowledge of the matter said.
Shein had revived plans to list in New York this year and its founder was considering a citizenship change to bypass proposed tougher rules for offshore initial public offerings (IPOs) in China.
The stock market debut plan has now been put on hold for the second time as a result of the sharp markets volatility over the past month that has been exacerbated in recent days by Russia’s invasion of Ukraine, the sources said.
Shein has no plans for an IPO, a company spokesperson said. The sources declined to be identified as they were not authorised to speak to the media.
The Chinese apparel platform is often associated with major environmental, social and governance (ESG) controversies and frequent product and service quality issues, analysts say.
“The former may prove irrelevant; the latter will need to be improve,” said David Reynolds, an analyst with Davy in London.
In November 2021, Chinese researchers working on behalf of the Swiss nongovernment organisation Public Eye visited some of Shein’s suppliers in Guangzhou, where they alleged that conditions among production workers violated labour laws.
The NGO also said that “precarious working conditions are also a daily occurrence” at the ultra-fast fashion leader’s European logistics centre in Belgium.
- Reuters, with additional editing by George Russell