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Fast Fashion Behemoth Shein Prepares for U.S. IPO Amidst Controversy

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Safak Costu
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Fast Fashion Behemoth Shein Prepares for U.S. IPO Amidst Controversy

The China-founded fashion giant, Shein, has confidentially filed to go public in the United States, as confirmed by sources familiar with the matter. Banking powerhouses Goldman Sachs, JPMorgan Chase, and Morgan Stanley are reported to be the lead underwriters on the offering, with the potential for Shein to go public in 2024.

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Shein's Market Dominance and IPO Plans

Despite the struggling market for initial public offerings in the U.S., Shein's decision comes at a time when its valuation has soared, with estimates placing it around $66 billion. The company's aggressive pricing strategy and extensive array of trendy styles have fueled its rapid expansion, allowing it to surpass fashion industry giants like Zara and H&M in the U.S. market.

Controversy Surrounds Shein's Success

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However, Shein's meteoric rise has not been without controversy. The company has faced allegations of design plagiarism, with claims suggesting that it has copied the designs of other creators without permission. These allegations have raised questions about Shein's business practices and respect for intellectual property rights.

Concerns Over Labor Practices

In addition, Shein has faced scrutiny over labor and environmental practices within its supply chain, with Republican attorneys general from 16 U.S. states asking the Securities and Exchange Commission to audit Shein's supply chain for the use of forced labor. The Chinese retailer has also been criticized over allegations of workers in supply chains being exploited and the negative environmental impacts of fast fashion.

As Shein prepares for its IPO, it continues to dominate the fast-fashion landscape while facing increasing scrutiny over its business practices. The company's future will undoubtedly be watched closely, both by those who admire its rapid growth and those who question its methods.

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