SHEIN investors are attempting to sell shares in private market transactions that value the online fashion behemoth at as little as US $ 45 billion, suggesting waning demand for a firm grappling with increased competition and regulatory scrutiny ahead of its long-awaited US debut.
In late 2023, shareholders offered stock valued at between US $ 45 billion and US $ 55 billion, according to sources familiar with the issue. This is down from SHEIN’s May funding round, which raised around US $ 66 billion. However, even at those low levels, they struggled to find purchasers, presenting the risk of more value loss, according to the sources, who requested anonymity to discuss private transactions.
The fresh proposals, which weren’t previously revealed, demonstrate how the gap between market demand and SHEIN’s initial public offering (IPO) objective of up to US $ 90 billion is expanding. While private transactions are not always comparable to the levels that a firm might eventually achieve on public markets, they are an important indicator of investor mood.
The lack of interest demonstrates how the once-dominant retailer of low-cost clothing is failing to compete with Temu, a direct rival created about a year ago by Chinese e-commerce behemoth PDD Holdings. At the same time, prominent apparel labels, like Fast Retailing’s Uniqlo and H&M, have accused it of copyright infringement.
SHEIN’s shares traded at roughly US $ 50 billion to US $ 60 billion in the second quarter of last year, with a target valuation of US $ 80 billion to US $ 90 billion in a listing. In one exceptional deal in late 2023, SHEIN changed ownership for almost US $ $30 billion – but on that occasion, an indebted seller was obliged to offload quickly, according to one of the sources.
Meanwhile, legislators in the United States have requested the Securities and Exchange Commission to delay the IPO until it certifies that the company does not utilize forced labor in its supply chain.
