Online fashion giant Shein approaches Sajid Javid ahead of blockbuster IPO | Economic news

Sajid Javid, the former chancellor of the exchequer, has been approached to take on a role at Shein, the online fashion giant which is pursuing plans for London's biggest IPO in years.

Sky News has learned that Mr Javid was among a number of senior City officials who spoke to Donald Tang, executive chairman of Shein, in recent weeks.

City sources said that if Mr Javid's appointment went ahead it could see him either join Shein's board or become an adviser to the China-founded company.

They added that Baroness Fairhead, a former chair of the BBC Trust, was also on a shortlist of candidates drawn up by headhunters advising Shein.

A person close to the company said the identities of those contacted reflected both the seriousness with which Shein took the issue of corporate governance and the importance it placed on a London listing.

Since leaving government, Mr Javid has taken on a role at Centricus, an investment company which unsuccessfully attempted to structure a bid for Chelsea Football Club in 2022.

A spokesperson for him, who had insisted Mr Javid would stand for re-election to his Bromsgrove seat a week before publicly announcing otherwise, did not respond to a request for comment from Sky News .

In recent weeks, several reports have reiterated Sky News' revelations that Shein had turned its attention to an IPO in London amid difficulty gaining approval from US regulators.

An IPO would likely value Shein at around £50 billion or more.

Paris was also reportedly considered by the company as a possible listing location.

Earlier this year, Jeremy Hunt, the chancellor, spoke to Donald Tang, executive chairman of Shein, to persuade the company to embark on what would be one of the biggest company IPOs ever made in London.

The meeting between Mr. Hunt and Mr. Tang underlined the importance that British officials attach to the idea of ​​outperforming the United States in a bid to land Shein's IPO.

If it comes to fruition, Shein could become the second-largest IPO in the history of the London Stock Exchange, behind the 2011 debut of Glencore International, the commodities trading and mining group.

Mr Tang also met LSE executives as well as more junior ministers as part of preparations for its IPO.

Shein filed paperwork for a listing in New York last year, but is increasingly concerned its application could be rejected by the U.S. Securities and Exchange Commission.

Goldman Sachs, JP Morgan and Morgan Stanley are advising on the transaction.

Headquartered in Singapore, Shein has become one of the world's largest online fashion retailers, although its growth has not been untouched by growing concerns over labor standards.

Last year, Sky News revealed that Shein was in talks to buy British fashion brand Missguided from Mike Ashley's Frasers Group.

Although the deal itself was only worth a modest sum, retail analysts said it could pave the way for Shein to build a more significant reputation in the UK, potentially through more collaboration. wide with Frasers.

Founded in China in 2012, Shein was valued at more than $100 billion last year, more than H&M and Zara's parent company Inditex combined.

The company's valuation was reduced to $66 billion in a stock sale last year.

Shein operates in over 150 countries.

It also struck a deal with SPARC Group, a joint venture between ABG, owner of Ted Baker, and Simon Property Group, a US shopping center operator.

As part of the deal, SPARC's Forever 21 fashion brand gained distribution on the Shein platform, which has 150 million users worldwide.

Shein acquired a one-third stake in SPARC Group, while SPARC Group also took an undisclosed minority stake in Shein.

The LSE's efforts to woo Shein come at a difficult time for the City as a listing venue for large multinationals, with ARM Holdings, the UK-based chip designer, choosing to list in New York instead. than in London.

Other companies, such as gambling operator Flutter Entertainment and pharmaceutical company Indivior, are considering moving their primary listings to the United States, citing higher valuations and more liquid markets.

However, in recent weeks, London has landed potential IPOs of Raspberry Pi, the personal computer maker, and AOTI, a medical technology provider.

Mr Hunt hosted a summit in Dorneywood last week attended by technology companies looking to list in the UK.

Shein declined to comment.