CFIUS Initiates National Security Review of Shein's Acquisition of Everlane
The Committee on Foreign Investment in the United States (CFIUS) has launched a national security review concerning Shein's acquisition of the clothing retailer Everlane, according to a report by Bloomberg citing unnamed sources. This scrutiny began after the $80 million deal was finalized in May 2026. Uniquely, Shein initiated the review process post-acquisition, which deviates from the typical practice where companies seek CFIUS approval prior to closing a deal.
The primary concern of the review is whether Shein's ownership of a business that manages U.S. consumers' personal data poses a potential threat to national security. As of now, no conclusions have been reached from this review.
Despite moving its headquarters to Singapore several years ago, Shein maintains significant operations in China and is subject to Chinese regulatory requirements. Following the acquisition of Everlane, Shein appointed Phil Ludvigson, an attorney from King & Spalding and a former Treasury official, to oversee the CFIUS submission. Sources indicate that the filing was made after the deal's closure due to Everlane's financial instability, necessitating a rapid response from both companies, and this timing was not influenced by any government intervention.
A spokesperson for Shein emphasized the company's commitment to adhering to all relevant laws and regulations in the markets where it operates. CFIUS experts note that national security concerns in consumer business transactions often stem from the collection of customer data, including names, addresses, and tracking cookies that create customer profiles. The specific reasons for the review of Shein's acquisition remain undisclosed.
In related news, Shein has commenced its initial public offering on the Hong Kong exchange, aiming to raise up to HK$13.9 billion (approximately $1.8 billion) through the sale of nearly 280 million shares, priced between HK$47.60 and HK$49.50 each. This move could potentially value the company at around $25.7 billion to $26.8 billion, with trading expected to start on September 1.
