The thrill of luring a Generation Z listing, made famous by Tik Tok, to London’s moribund stock market is too good to resist.
No wonder Chancellor Jeremy Hunt has decided to lay out the red carpet to Asian fast fashion star Shein.
A successful initial public offering for the £40billion-£70billion fashion colossus would be a huge fillip.
It could mark an end to the series of escapees to New York, with life sciences group Indivior the most recent firm proposing to head across the Atlantic.
Shein may be headquartered in Singapore but to all intents and purposes it is a China success story, sourcing its cotton there, promoting its wares on Beijing-controlled Tik Tok and using the best of the country’s online technology.
Talks: Chancellor Jeremy Hunt has decided to lay out the red carpet to try and lure Asian fast fashion star Shein into a London listing
Nasdaq is generally considered the best place for tech-enhanced businesses and Shein, backed by Silicon Valley’s Sequoia, looks right up its street.
But current coolness of Sino-US relations is getting in the way. The American authorities are demanding the kind of disclosures about ownership, sourcing and other proprietary details which Shein’s founder Chris Xu finds uncomfortable.
That’s before Right-wing, anti-Beijing forces on Capitol Hill start raising a storm. The possibility of floating in Hong Kong or Singapore is still there.
Being so close to the homeland might be uncomfortable. London looks as good as anywhere as it still attracts global players.
The Kazakhstan carrier Air Astana is the latest to climb aboard, and the London Stock Exchange and City regulators are rushing to liberalise the listings regime.
Moreover, Europe is home to fast fashion. The FTSE hosts Primark, under the rubric of Associated British Foods, and there are comparators nearby in Sweden’s H&M and Spain’s Inditex, owner of Zara.
The City also has its own online fashion champion in Next and upstarts Asos and Boohoo, even if the latter are not having the best of times.
Before the UK becomes too passionate about Shein, we ought to think about possible pitfalls. Valuing the firm, which was given a heady price at its last fund raising, is going to be awkward.
After all, fast fashion can be a volatile enterprise as former ‘King of the High Street’ Philip Green learnt to his cost.
As serious are the security implications. Shein is not in the same category as the Hinkley nuclear plant, partly financed by Chinese funds.
But there are people on the Tory benches, such as former leader Sir Iain Duncan Smith, who have deep reservations about any Beijing involvement in the UK.
Even if all the systems which have made Shein a star are based in Singapore, the possibilities of misuse of databases affecting the UK must be there.
What, if in a worst-case scenario, the tensions in the South China Sea were to flare up. Or Xi Jinping, following the example of Vladimir Putin in Ukraine, decided it was time to demonstrate resolve and invade Taiwan.
Western sanctions would doubtless follow and if Russia offers any guidance, firms quoted on the London market could be delisted and assets frozen.
Not all that glitters is gold.
Save our Currys
The Elliott Advisers’ siege of electronics retailer Currys continues with an improved offer of 67p-a-share, or £757million.
Rightly, the group’s board is holding firm, but as we have seen in past raids on FTSE firms, faced with a properly priced bid, it becomes hard to resist.
What investors need to bear in mind is that companies on the UK market trade at a sharp discount, of 30 per cent or more, to their New York counterparts.
Moreover, if the buyer is paying in dollars, the relatively low valuation of the pound at present means this is bargain- basement territory. There is an assumption that 80 p would do the trick and resistance would subside.
It would be terrific if chairman Ian Dyson recognised that Currys has a decent UK heritage, is important to our shopping centres, a promising Scandinavian footprint and is not for surrender.
Safety barrier
Good to see Chancellor Jeremy Hunt reiterating his commitment to making Britain an AI powerhouse at a pre-Budget meeting with tech and leaders at No 11.
He needs to recognise that the recent UK White Paper on AI, which allows the Silicon Valley giants to draw their own safety boundaries, risks stifling the principle of Open AI.
That is essential if Britain is to have real success.
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