Shein reportedly files for US IPO in long-awaited move
Rite Aid collapse reveals challenges of pharmacy retail
News bites
By Inside Retail staff writers
Shein reportedly files for US IPO in long-awaited move
China-founded fashion company Shein confidentially filed to go public in the US at the end of November , two sources familiar with the matter told Reuters .
Goldman Sachs , JPMorgan Chase and Morgan Stanley have been hired as lead underwriters on the offering , and Shein could go public sometime in 2024 , the sources said .
Shein has been planning to go public for the last few years , but has halted plans almost twice since then . The fastfashion giant ’ s decision now comes at a time when the broader market for new issues remains laggard .
In recent months , public companies such as British chipmaker Arm Holdings , grocery delivery app Instacart , marketing automation firm Klaviyo , and luxury sandal maker Birkenstock have disappointed investors with lackluster performances .
Reuters reported in July that Shein had been working with at least three investment banks about a potential IPO and was in talks with the New York Stock
Exchange and the Nasdaq . Shein , which is now based in Singapore , declined to comment .
The company was valued at more than $ 60 billion in May and is expected to become the most valuable Chinafounded company to go public in the US since ride-hailing giant Didi Global ’ s debut in 2021 at a $ 68 billion valuation .
Fast-fashion retailers have been gaining popularity in the US , with Shein taking away market share from the likes of Gap as shoppers look for fresher styles and trendier clothing .
In August , Shein partnered with SPARC Group , a joint venture between Forever 21 owner Authentic Brands and mall operator Simon Property , in an attempt to expand their market reach and build on the growing demand for their products .
Shein and Temu . com , however , have not been able to turn shopper visits to their sites into sales and are far behind market leader Amazon . com , which has been able to convert visitors into buyers .
Rite Aid collapse reveals challenges of pharmacy retail
Pharmaceutical retail chain Rite Aid received interim approval to access up to $ 3.45 billion in debtor-in-possession financing to continue paying its vendors , employees and suppliers after filing for bankruptcy in October .
Rite Aid ’ s stock has fallen by 80 percent so far this year , and its long-term debt , which was $ 3.3 billion in June , exceeds the value of the company ’ s assets by about $ 1 billion . The retailer currently operates 2,100 pharmacy locations across 17 states , but will be closing underperforming stores as part of the restructuring process .
To help move the company forward , Rite Aid recently appointed Jeff Stein as CEO , chief restructuring officer , and a member of the board of directors , effective immediately .
Rite Aid isn ’ t the only pharmaceutical retailer in the US that is facing financial challenges .
Global management consulting firm McKinsey and Co stated that the number of independent pharmacies decreased by about 50 percent between 1980 and 2022 , largely due to independents being pushed out by larger pharmaceutical chains . Neil Saunders , managing director and retail analyst at GlobalData Retail , identified three main issues at play in the drugstore space : the competition in the convenience sector , the failure to invest in the retail offer , and the rise of online shopping .
Moving forward , Saunders theorized that larger pharmaceutical chains would be seeking outside opportunities for growth , but should remain cautious in their approach .
“ Drugstores are also looking to healthcare to provide new growth opportunities . This includes primary care , which they see as a very lucrative segment . That ’ s arguably a sensible move , but if it leads to further neglect of the retail business , it may cause further damage to market share ,” Saunders warned .
The current situation leaves the door open for big-box chain retailers like Amazon , Walmart , Target and Costco to step in and serve communities that are experiencing a “ pharmacy desert ”, and for independent medicinal companies to serve specific consumer needs .
8 www . insideretail . us December 2023