1 day ago

Shein Faced Billions in Investor Costs as IPO Approached

Shein had 4.4 billion reasons to speed its IPO along · livemint.com

Shein was preparing to sell shares to the public through an IPO.

Some investors had put money into the company before the IPO.

Shein had promised those investors annual returns of 8% or 12%.

This meant the company could owe them about $1.3 billion.

Shein might also need to pay up to $2.2 billion because its value fell after they invested.

Together, these payments could be less than $3.5 billion.

The exact amount is not known because Shein has not disclosed it.

These large potential costs were described as a reason to move the IPO along quickly.

Key facts

Headline figure: $4.4 billion was cited as a reason for Shein to speed up its IPO.
Guaranteed-return payments: About $1.3 billion was owed to several late-stage pre-IPO investors.
Promised annual returns: The investors were guaranteed returns of either 8% or 12% annually.
Potential valuation compensation: Up to $2.2 billion could be owed for the fall in Shein’s valuation after the investments.
Projected valuation basis: The $2.2 billion estimate used the lower offer-price figure of HK$47.60 per share.
Estimated combined bill: The total bill for these obligations will likely be smaller than $3.5 billion.
Disclosure status: Shein has not disclosed the exact amount.

livemint.com · 1 day ago